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First-time homebuyers are getting frozen out of the market
The gulf between supply and demand of new homes continues to grow, heightening difficult conditions for first-time buyers to enter the market.
Using a metric reflecting when an individual moves out of a shared living situation, U.S. Census numbers show 12.3 million households were formed from January 2012 to June 2021. However, only 7 million single-family homes were built in that time, according to CNBC.
Research from Realtor.com reported by the outlet reveals that a gap of more than 5.2 million homes is 1.4 million higher than the same measure from 2019, when the gap was just above 3.8 million homes between forming households and constructed homes.
Construction companies were already suffering from labor shortages but faced further difficulties as the pandemic hampered labor movement and the supply chain, also causing the prices of building materials to skyrocket in some instances.
Additionally, the pandemic created more demand for homes and the report noted as supply eventually fell even further behind, builders would need to double their pace of recent production to make up the difference in the next five to six years.
Boston Condos for Sale and the Bottom Line
Builders have been unable to keep up with the pent-up demand for homes and forced to turn to desperate measures to stay afloat. Some builders have been restricting sales to avoid being further overwhelmed, which has caused prices to balloon.
Boston Condos for sale Sale
Updates: Boston Real Estate for Sale 2021
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Scott has a post about how prices are making it tough on first-time homebuyers in Massachusetts. From Scott’s piece:
“Anyone who has (just) five to ten percent down, they have gotten creamed,” Sam Schneiderman, president of the Massachusetts Association of Buyer Agents, told me. “People don’t even look at those offers realistically.”
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Updated: January 2018
