The Housing Shortage Is Still Out There

A proliferation of housing supply estimates in recent years have put the national shortfall at anywhere from 1.5 to 5.5 million units. Nearly the only agreement in this wide range of estimates is that there is certainly a housing shortage and it is dire. In their paper, McClure and Schwartz critically ask if there even is a housing shortage and in what specific markets and segments housing has been underbuilt. Going against the prevailing narrative, McClure and Schwartz find that there is likely not a national deficit of housing, arguing that we have overbuilt the majority of markets across the country. While they do find a widespread undersupply of affordable housing for the lowest-income renters, they do not find this to be a supply issue but instead note that it is the product of mismatches between incomes and rents. But arguing that the nation’s housing stock is overbuilt at a time when housing markets are clearly not functioning properly does seem to come with a higher burden of proof, and the analysis perhaps raises more questions than it answers.