THE STATE OF THE NATIONS HOUSING
June 11th, 2007Each year Harvard University's Joint Center for Housing Studies releases their research on The State of the Nation's Housing. The 2007 report is now available. If that is too much, you can try the Executive Summary. Here are some of the key findings.:
The length and depth of the current correction will depend on the course of employment growth and interest rates, as well as the speed with which builders pare down excess supply. But the longer term outlook for housing is more upbeat. Thanks in large part to recent immigrants and their native-born children, household growth between 2005 and 2015 should exceed the strong 12.6 million net increase in 1995–2005 by some 2.0 million. Together with the enormous increase in household wealth over the past 20 years, healthy income growth will help propel residential spending to new heights. The report notes that inventory overhang is the biggest near-term issue. One claim the authors make that clearly applies to Maui is But housing affordability remains a pervasive problem. In just one year, the number of households with housing cost burdens in excess of 30 percent of income climbed by 2.3 million, hitting a record 37.3 million in 2005. Making real headway against this disturbing trend requires an unlikely combination of structural and public policy shifts—that state and local governments ease development regulations that drive up production costs, Yup. Trying to fix an affordable housing issue by placing a large tax on development (effectively the Maui County Council's approach) makes no economic sense whatsoever. None. While this report is somewhat negative in tone, the longer-term view it espouses stands in stark contrast to the doomsaying coming out of the mainstream press on the U.S. Housing market. For more information on the report, contact us!
