Georgia Has the 5th Lowest Median Home Age in the U.S.
Wednesday, August 24th, 2022
The last two years have shown that the stock of housing in the U.S. is inadequate for the country’s needs. Fast-rising home prices and rents nationwide illustrate that supply has failed to keep up with housing demand. Experts at federal mortgage backer Freddie Mac estimate that the U.S. is nearly 4 million housing units short of what the population needs.
But another challenge is that America’s housing stock is getting older. Today, the median age of a housing unit in the U.S. is 42 years, a figure that has risen steadily over the last two decades. And many older homes are located in places where population growth is flat or slower than in other parts of the country. The result is an imbalance between the locations where housing is more plentiful or affordable and the locations where people are trying to live.
And older homes can have additional downsides. While some residents appreciate the period charms of an older home, these homes tend to have more maintenance problems and lower energy efficiency, which can raise costs of ownership. They are also more likely to have used dangerous materials like asbestos, lead paint, or radon, which create health risks.
One primary reason for both the shortage and aging of America’s housing stock is the collapse of the building industry after the Great Recession. From 2000 to 2009, when the housing boom reached its peak, new construction kept pace with historical levels as builders added nearly 19 million new homes in that decade. But when the bubble burst and the recession set in at the end of the decade, the rate at which the U.S. added housing fell off dramatically. Since 2010, the U.S. has added only 8.6 million new housing units. The consequences of underbuilding have played out dramatically over the last two years. With too few homes on the market, competition for residential real estate has been high. Home values have skyrocketed since the beginning of the COVID-19 pandemic, with the median sales price in the U.S. up by more than one-third since 2020. In turn, these increases have priced more prospective buyers out of the market, which has left more people competing for rentals and driving prices higher there as well.
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