A Housing Shortage? Really?
A news story by CNN Money came out and asked this question: Is A Housing Shortage Coming? Their premise is that, because of the housing industry issues that have plagued the country for a few years, that there aren’t enough homes for those people who are ready to buy either existing or new homes.
Frankly, when I read stories like this, it makes me wonder about the intellect of these people who supposedly have some kind of finance background, or at least some investigative skills. Are there enough houses? Please!
For most of the country, there are plenty of houses. Well, that’s kind of a misnomer, so let me clarify this. In those states that have suffered the most, there are so many homes available that it’s amazing banks aren’t working more with potential home owners in getting those loan applications through and those homes purchased. In California, there were so many homes available that banks which had foreclosed on many of those homes took some of them off the market because they were driving prices too low. In that case, the homes are there, but the banks might not be making them available.
However, as bad as the housing industry has had it, there were still places where homes were still being built. In places like my home area, Syracuse NY, new homes are being built as fast as ever in the suburbs, while the city is starting to convert more downtown property to condominiums to entice 20 and 30-somethings to move back and help the city grow again. In many parts of Texas, home building has never slacked off either, as they have weathered the housing crisis fairly well for their size.
In the story, cities that were highlighted were New York City, San Francisco and Seattle. New York City has had a problem with space for years, which means that has nothing to do with home builders not trying to build homes. And NYC has been losing population, so if present condominium owners, since there really aren’t lots of houses throughout parts of the city, decided to drop prices a little bit, there are plenty of spaces available for occupation. I don’t know San Francisco or Seattle as well, but the reports are that both cities will have housing prices dropping possibly through 2012. If housing prices are dropping, it means there’s plenty of available space for new home owners or tenants. After all, prices don’t drop if there’s too few homes.
True, there might be some communities where there aren’t enough homes available. I just don’t feel it’s as pervasive as CNN Money believes it is.