by Calculated Risk on 12/15/2021 01:01:00 PM
Today, in the Real Estate Newsletter: The Household Mystery
Using the Census Bureau data, we can calculate the impact the number of households needed in the 1970s due to 1) population growth, and 2) changes in household size:
Over those 12 years, the US needed an additional 950 thousand housing units per year due to the changes in household size. However, the US only needed about 550 thousand housing units per year due to population growth. Because of the changes in household size, the U.S. needed far more additional housing units in the ’70s than in recent years with the number of persons per household relatively stable.
Over the last two years – in 2020 and 2021 – the US needed very few new housing units due to population growth, so the demand for homeownership and rentals must be coming mostly from smaller household size. (NOTE: There was also significant 2nd home buying and other reasons).
Is something similar happening now to household size with the millennials? It probably is, and unfortunately household data is not timely or reliable.