Housing unit growth fell in half in wake of Great Recession: census
The total number of U.S. housing units grew 6.7 percent between 2010 and 2020, according to Census Bureau data released Thursday, falling sharply after the Great Recession.
Housing unit growth fell by roughly half in the 2010s from its level during the first decade of the new millennium, according to the 2020 census, after the collapse of a housing bubble in 2007 kicked off what became the Great Financial Crisis.
“The housing boom of the mid-2000s contributed to a rapid expansion of supply, while the housing crash and ensuing Great Recession of 2007-2008 resulted in an increase in the number of vacant units,” wrote Evan Brassell, chief of housing statistics for the Census Bureau, in a Thursday post breaking down the data.
“Those issues, and the recovery that lasted well into the next decade, potentially reduced demand for new construction,” he added.
The 2010s began shortly after the start of the longest economic expansion in modern U.S. history — 128 straight months of growth from June 2009 to February 2020 — that brought unemployment to its lowest level in 50 years. As the U.S. economy reoriented toward the service sector, several quickly expanding metropolitan areas across the South and West led the country in housing unit growth.
Washington, D.C., led all states and Puerto Rico with an 18.1 percent increase in housing unit growth between 2010 and 2020, followed by Utah (17.1 percent), North Dakota (16.7 percent) and Texas (16.2 percent.) Only West Virginia and Puerto Rico had fewer housing units in the past decade than they did between 2000 and 2010.
Brassell said that housing unit growth was fastest in counties that made up metropolitan areas, which make up a growing share of the U.S. population and economic output. Housing growth fell off in more than 50 percent of U.S. counties, but double-digit gains across most metro areas helped keep growth positive on net.
But the pace of housing unit growth is still far too slow to address a worsening shortage of affordable housing across much of the U.S.
Housing prices have risen at the fastest pace since the run-up to the collapse of the 2007 bubble, skyrocketing by 23 percent annual rate in June. While experts say another foreclosure crisis is unlikely thanks to tighter lending standards imposed after the recession, the rapid growth of housing prices may still lock out thousands of potential buyers and drastically increase wealth inequality.