Report counters ‘popular narratives’ of housing supply crisis 

The U.S. doesn't have a severe housing shortage, a new report argues — but the country does have a meaningful shortage of affordable units, especially in markets where development costs remain high.

The nation's housing supply has shifted in recent years to become more balanced, with a modest oversupply in multifamily housing and a modest undersupply in single-family homes, according to a Zelman & Associates report released in July. 

Housing market's about-face: The analysis by Ryan McKeveny and Kevin Kaczmarek, titled "A Decade Divided, The Troubling Trajectory of Demographics," found a significant shift has occurred this decade.

In the first few years of the 2020s, the U.S. saw record household growth as immigration surges and pandemic-related factors contributed to large numbers of young adults forming households. This uptick put pressure on the nation's housing supply.

But more recently, changes in affordability have stalled the trend of young adults striking out on their own as home prices and mortgage rates have spiked. Immigration, meanwhile, has slowed considerably.

Household growth on the decline: When affordability challenges are combined with lower immigration levels, declining birth rates and an aging population, the likely result is a slower pace of household growth than is seen in typical housing cycles. The report estimates that this growth will fall from around 1.2 million households annually in 2024 and 2025 to roughly 1 million each year from 2026 through 2029.

In a Sept. 2 webinar, ZeIman Co-founder and Executive Vice President Ivy Zelman said the U.S. is reaching a pivotal point in history: While Americans are living longer than they used to, the country's total number of deaths is expected to exceed the number of births by 2030.

Housing supply 'more balanced' than widely thought? It has proven difficult to pinpoint exactly how severe America's housing supply crisis really is.

While recent Realtor.com research indicated that the U.S. had a deficit of 4.03 million homes in 2025, the National Association of Home Builders and researchers with Harvard's Joint Center for Housing Studies estimated the shortage to be around 1.2 million homes in 2024 and 3.78 million in 2023, respectively. The White House recently said the shortage is much greater, pegging the deficit earlier this year at around 10 million homes.

But Zelman & Associates' analysis "suggests current market indicators paint a more balanced picture than many popular narratives imply," Zelman said in an Aug. 5 blog post. Both new and existing home inventory has improved, she wrote, and there are vacancies in the rental market.

"That does not mean every housing challenge has been solved," Zelman added. "The United States continues to face meaningful shortages of housing that is affordable to lower-income households, particularly in markets where development costs remain prohibitively high. Delivering truly affordable housing at scale remains difficult even with government support, and considerably more challenging without it."

As household growth slows, construction activity should not be pulled back, according to Zelman. But the housing market won't have strong growth unless affordability improves, she warned. When this happens, incremental demand is expected to be unlocked.