Construction companies are struggling to keep up with orders for new homes.
Shortages of key construction supplies, as well as a national labor shortage have thrown a wrench in plans to address the housing crisis by building new homes. In August, the queue of unbuilt homes that had been cleared for construction hit an all-time high, according to a report that was released on Tuesday from the US Census Bureau and the US Department of Housing and Urban Development. The record is based on seasonally adjusted data.
Over the past year, demand for homes has outpaced the speed at which companies can pump out new ones, contributing to a housing market that has created bidding wars over lackluster homes, even one that was described as "a house from hell".
Several major homebuilding companies have warned they will not be able to complete as many projects this year as they had planned. On Monday, homebuilding giant Lennar warned that supply chain snags were preventing the company from meeting its goals. Homebuilding company D.R. Horton also said it has struggled to combat shortages.
Both companies pointed to constrained supplies of key goods like lumber, vinyl siding, flooring, and windows — products that have been help up in a glut of shipping containers trapped at crucial US ports. Experts have warned that the supply constraints will continue through 2022. Last week, UPS President Scott Price said the company does not see an end in sight to the disruptions in the global transportation system.
Earlier this year, mortgage giant Freddie Mac reported that the US is facing a shortage of nearly 4 million homes due to a red hot housing market paired with a decline in the construction of entry-level homes over the past 40 years.
