Homebuilding Is Hot Again. And Not Nearly Hot Enough - Bloomberg

Homebuilding Is Hot Again. And Not Nearly Hot Enough - Bloomberg

The less-good new is that there's still a long way to go.

The chart tells a familiar story. Construction of new single-family homes spiked in the early 2000s, then plummeted when the housing market collapsed. Despite the recent recovery, homebuilders have yet to return to the levels of, say, the early 1980s, when members of the baby boomer generation began to buy their first homes.

Even accounting for multifamily construction, which has picked up in recent years, the U.S. housing market is still adding new units at a slower rate than it has for the past half century. That doesn't account for the size of the U.S. population, projected to grow by 60 million people by 2040.

Whether or not builders keep up the pace is complicated by a number of conflicting factors.