What's Happening?
Damian Eales, CEO of Move Inc., which owns Realtor.com, has issued a call to action for the housing sector to address a significant housing supply shortage in the United States. In an open letter, Eales highlighted a deficit of 4 million homes and noted
that home prices have increased by 66% over the past decade. He emphasized the need for the housing industry to focus on increasing supply rather than relying on demand-side subsidies, which can exacerbate affordability issues. The letter comes amid a slowdown in new-home permits and starts in 2025, as builders face challenges in selling completed inventory due to affordability concerns and cautious buyer behavior. Eales pointed out that the median age of first-time homebuyers has risen to 40, and existing-home sales have remained at three-decade lows. He urged stakeholders to support legislative efforts to boost housing supply and modernize zoning laws.
Why It's Important?
The housing supply shortage has significant implications for the U.S. economy and society. With home prices rising and borrowing costs increasing, many potential buyers, especially first-time homebuyers, are being priced out of the market. This situation contributes to economic inequality and limits access to homeownership, a key component of the American Dream. The shortage also affects the broader economy, as the housing market plays a crucial role in economic growth and stability. Addressing the supply gap could help stabilize home prices, making housing more affordable and accessible. Legislative efforts, such as the Housing for the 21st Century Act, aim to tackle these issues by focusing on supply-side solutions and reducing regulatory barriers.
What's Next?
The U.S. House of Representatives has introduced the Housing for the 21st Century Act, which focuses on increasing housing supply and easing regulatory constraints. The bill has passed the House Financial Services Committee and awaits a full floor vote. If approved, it will be sent to the Senate for consideration. Meanwhile, Eales encourages stakeholders to advocate for modernized zoning laws and overcome local opposition to new housing developments. The outcome of these legislative efforts and industry actions will be crucial in determining the future of the U.S. housing market and its accessibility to potential homeowners.
