1. The obvious: We have underbuilt for over a decade. By millions. Now, many projects are being placed on hold as financing them has become more costly with higher interest rates. Restarting a stalled building project takes many months... sometimes, years.
2. The demands on limited resources and commodities needed for building keeps growing.
3. The number of wealthy people buying more than one or two homes is growing.
4. The very wealthy will create MULTIPLE wealthy consumers as they pass their wealth on to family members. The Top 10% of wealthy in the US have wealth of around $47 trillion dollars. Wealthier people buy homes.
5. De-globalization is bound to make materials for building more expensive even after shipping cost savings. The threat of new or larger tariffs on cheaper imports is certain to fuel this.
6. Even if inflation is the targeted 2% per year, that is about 19.5% price growth over a decade.
7. Currently 35% of the apartment stock in the US is at least 60 years old and the median age of an American home hit 43 in 2021 (Harvard Joint Center for Housing Studies), up from 27 in 1991.
8. 6.7 million US households live in substandard housing, including 1 in 10 of the poorest renters. A Federal Reserve Bank of Philadelphia study found it would cost $126.9 billion to repair the US’s inadequate housing.
9. A fully funded $1 TRILLION infrastructure bill will place enormous demands on building materials and labor for the next decade.
10. About 1.5 million people immigrate to the US each year. Some say it's far higher than this. They all need a place to live.
11. Today around 17% of Americans are 65 years and older. By 2040 that is expected to be above 21%. Accelerated medical advances could keep people in their homes far longer. While this could slow the natural cycle of inventory supply, these homes may require more repairs once they do come to market.
12. More frequent extreme weather events could require more home repairs and replacements.
13. The world's population keeps growing. Right now it's approx 8 billion. By 2050 it is estimated to rise to 9.8 billion and new housing and infrastructure will be required to support them.
