If you are still trying to understand why the housing market in the United States is in trouble just read the following paragraph.
Now to vacancies. There were 18.4 million vacant homes in the U.S. in Q4 ’10 (11 percent of all housing units vacant all year round), which is actually an improvement of 427,000 from a year ago, but not for the reasons you’d think.
The number of vacant homes for rent fell by 493 thousand, as rental demand rose. 471,000 homes are listed as “Held off Market” about half for temporary use, but the other half are likely foreclosures. And no, the shadow inventory isn’t just 200,000, it’s far higher than that.
So think about it. Eleven percent of the houses in America are empty. This as builders start to get more bullish, and renting apartments becomes ever more popular. Vacancies in the apartment sector have been falling steadily and dramatically, why? Because we’re still recovering emotionally from the toll of the housing crash. via Diana Olick at CNBC
11 percent or 18.4 million homes in the United States are empty.
To put this in perspective there is only 329,000 homes expected to be built this year.
So lets do the math.
Used Vacant homes / New Home Construction
18,400,000 / 329,000
This means there are 55 EMPTY HOMES for every NEW HOME BEING BUILT THIS YEAR.
Now lets do one last bit of math:
Used Vacant Homes / Home Sales for 2010
18,400,000 / 5,000,000
There is 3.86 empty homes for every home sold last year.
Gulp…
With the number of homeownership steadily declining, renters can also expect their price for rent to increase tremendously. There is another posting on Mortgage News Daily which speaks about the same topic.
Aw, come on! Nothing to worry 'bout here. Benny and Obamesiah will just institute a "cash for junkers" program where those *unwanted* old houses have to be torn down so they can "trade-up" to a brand new house, complete with a fresh wad of mortgage debt to keep the bankers well outfitted in sirloins and champagne for years to come!
Viva la (nuevo) bubble!
Wow, those are some sobering numbers. In a market where people are very weary of buying and the rental rate can't even keep up with the number of vacancies, it definitely asks a huge question of why we are still bothering to build. I mean, there are entire developments with less than 55 houses.
"Where have all the people gone?" Were ALL these empty homes occupied at the same time and now they are all empty at the same time? Or were they all occupied at the same time while other homes were vacant at that time? Are these possibly second and third homes that are now not affordable to keep? People lost their homes due to finances, mortgages, jobs, etc. and then were forced to relocate to live with family, friends, apartments, the street, and so on. Building a home for a client that can afford to pay for it is one thing, building on spec just doesn't seem to make sense.
Seems like the builders have to take a break from further building and give the re-builders and renovators a chance renovating, and hope the people will get back their ability to move back in to those empty houses.
Not very good stats at all..With all that excess inventory to get rid of, we are probably looking at least until late 2012 for any signs of improvement….
18 million plus vacant homes. What a waste of resources. I wonder how many homeless people there are in the USA?
Gulp is right! Whay are builders revving up? Because the banks won't release the foreclosures more than a trickle and short sales can be intense for a buyer. That creates demand in the markets. But hey, rent is up….
Wow, 18 million homes! We need some inventory in San Diego. We need these banks to send them loose.
Still, I don't understand why they allow to built so many new construction when the inventory is so high
Wow, that is incredible, and I thought there were enough real estate signs out there but I was wrong!
I think this rental trend is something we are likely to see for a number of years as so many people have lost their homes and are unable to purchase even if they want to.
It is so different in Australia, you cannot 'walk away' . The bank will take over the property, then take you for everything you own!
Its amazing that we have so many homeless people and so many vacant homes. It seems like there should be some program in place to help benefit both parties.
Aritcles like this really grease the shafts of knowledge.
shocking numbers … as 11% homes are empty in US … even if there is recession it is going to improve …so i would say that this is a time to buy a house … think about 5 years later .. there is definatly going to be a boom in real estate market ..
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