The U.S. doesn’t have enough affordable homes

Today in U.S-housing-is-increasingly-unaffordable news: The proportion of on-the-market starter homes is shrinking across the nation, according to Trulia. In the last quarter of 2016, entry-level properties made up just 21 percent of the market while high-priced houses made up 55 percent.

Many house hunters in the U.S. are on the lookout for those more affordable abodes—26.9 percent of all searches were for starter homes—but availability runs far short of demand. Based on Trulia’s search volume in the last quarter, 75 of the 100 largest U.S. metros saw a larger percentage of search interest in starter homes than the percentage of listings that were actually starter homes.

Two of the cities with the biggest gaps between supply and demand are Raleigh, North Carolina, and Colorado Springs, Colorado. But Dallas, Texas, takes the unaffordability cake, with starter homes making up just 6.2 percent of listings but 18.1 percent of home searchers. The lack of affordable inventory creates a vicious cycle as the low inventory generates more competition among prospective homebuyers, in turn driving up prices.

On the flip side, Philadelphia, Pennsylvania, has more starter home listings than there are people searching for them, as does Detroit. Explore the full report here.

Via: Construction Dive, Trulia