Gap between families and available homes widens and likely continues to grow
A lack of affordable homes has created millions of “missing households,” keeping families in shared homes and unable to strike out on their ownMore than two-thirds of these missing households earn less than $35,000 a year, highlighting the economic barriers many face when trying to find a place of their own
, /PRNewswire/ — A significant shortage of affordable housing options is fueling America’s affordability crisis, particularly for those looking to move out on their own for the first time, a new Zillow analysis shows. This huge housing deficit underscores the need for policies and investments that can boost construction.
This lack of housing — especially affordable options — has left millions of households “missing.” These missing households consist mainly of individuals and families living in another family’s owned or rented home. Across the country in 20211, there were nearly 8 million missing households, compared to just 3.7 million housing units available for rent or sale, a deficit of 4.3 million homes.
“The U.S. housing market is like a high-stakes version of the game musical chairs,” said Orphe Divounguy, senior economist at Zillow. “There are simply not enough homes for millions of people. Unless we address the shortage of smaller, more-affordable, starter-type homes, we risk leaving families without a seat — and it will only get worse over time.”
For each of the 3.7 million housing units available for rent or sale across the country in 2021, there were more than two potential households — families likely in need of their own homes. This means even if every missing household was willing and able to move into their own home, 4.3 million households would have been left without a place to move to.
The bulk of families doubling up have consistently lower incomes, highlighting the need for smaller, more affordable housing. Of the families that are doubling up, 68% had an annual income of $35,000 or less.
The mismatch between potential housing needs and available homes across the country is playing out in dramatic fashion in the most expensive coastal housing markets, such as Los Angeles, San Francisco, San Jose, San Diego and Boston but also in places like Boise.
What consumers need to know
Zillow has a number of tools and partnerships to help consumers overcome these challenges.
Zillow’s affordability calculator and monthly payment filter can help shoppers better understand how much they can afford and how best to find an affordable mortgage payment. Working with a trusted real estate partner is also critical to helping find an affordable home for new buyers.
All home listings on Zillow display available programs that help eligible shoppers with a down payment — the biggest barrier to homeownership for most. This first-of-its-kind tool was used by more than 1 million customers in just its first year, with the average recipient qualifying for $17,000 towards a down payment.
And for renters, Zillow offers a single, flat-fee rental application tool that helps would-be-tenants avoid paying hundreds of dollars in application fees, which can quickly become a financial hardship for low-income families.
What policymakers can do
Construction productivity has been declining relative to the rest of the U.S. economy since the late 1960s, with land-use restrictions, building approval delays, and stunted construction sector growth all contributing to the lack of new home construction across the country. Policymakers should explore ways to boost production and overall growth of the construction sector to ensure housing supply can catch up to demand.
Additionally, experts are near unanimous that loosening restrictive zoning laws is critical to creating more supply and easing housing costs. According to public polling conducted by Zillow, four out of five adults support allowing more, smaller home types to be built in their own neighborhoods. Researchers also suggest that speeding up building permitting, eliminating parking requirements, tax incentives to rehabilitate underutilized housing stock, and expanding affordable housing trust funds could all help ease the shortfall in new construction.
Metropolitan Area*
Housing Unit
Deficit (2021)
Missing Households
(2021)
Total Units for Sale
or Rent (2021)
Mortgage Burden
with 10% Down
Payment (May 2023)**
Rent Burden
(May 2023)**
United States
4,283,926
7,967,749
3,683,823
37.7 %
31.5 %
New York, NY
376,376
561,810
185,434
53.4 %
42.0 %
Los Angeles, CA
333,862
446,105
112,243
84.2 %
39.6 %
Chicago, IL
87,433
191,542
104,109
29.9 %
28.4 %
Dallas, TX
47,622
153,027
105,405
37.9 %
26.0 %
Houston, TX
16,397
128,220
111,823
34.0 %
26.3 %
Washington, DC
133,971
192,375
58,404
38.2 %
22.9 %
Philadelphia, PA
64,789
127,443
62,654
33.4 %
25.8 %
Miami, FL
60,057
140,624
80,567
55.7 %
48.8 %
Atlanta, GA
63,467
133,929
70,462
39.0 %
29.3 %
Boston, MA
151,765
184,200
32,435
50.7 %
33.6 %
Phoenix, AZ
86,996
132,340
45,344
47.4 %
29.6 %
San Francisco, CA
161,581
204,028
42,447
74.0 %
29.2 %
Riverside, CA
72,354
106,054
33,700
59.5 %
39.2 %
Detroit, MI
35,159
73,183
38,024
28.5 %
23.5 %
Seattle, WA
108,858
142,787
33,929
56.5 %
25.4 %
Minneapolis, MN
76,595
101,083
24,488
34.4 %
21.8 %
San Diego, CA
94,494
120,535
26,041
76.1 %
38.7 %
Tampa, FL
28,087
73,710
45,623
46.8 %
38.0 %
Denver, CO
69,693
96,785
27,092
53.1 %
26.1 %
Baltimore, MD
34,127
67,401
33,274
32.4 %
22.4 %
St. Louis, MO
13,177
45,700
32,523
27.5 %
22.1 %
Orlando, FL
15,355
68,161
52,806
44.2 %
33.8 %
Charlotte, NC
17,805
48,308
30,503
40.8 %
28.6 %
San Antonio, TX
14,637
48,585
33,948
35.7 %
26.1 %
Portland, OR
76,717
95,749
19,032
54.0 %
25.7 %
Sacramento, CA
63,749
79,075
15,326
54.7 %
31.4 %
Pittsburgh, PA
17,094
44,585
27,491
24.9 %
24.9 %
Cincinnati, OH
31,032
48,834
17,802
30.2 %
24.0 %
Austin, TX
56,745
80,984
24,239
44.8 %
24.8 %
Las Vegas, NV
26,456
63,638
37,182
49.5 %
31.6 %
Kansas City, MO
26,360
46,999
20,639
31.9 %
21.6 %
Columbus, OH
33,399
51,940
18,541
33.9 %
24.0 %
Indianapolis, IN
14,207
38,417
24,210
30.9 %
24.6 %
Cleveland, OH
13,620
37,484
23,864
27.5 %
25.4 %
San Jose, CA
60,895
77,620
16,725
81.1 %
26.4 %
Nashville, TN
34,909
60,829
25,920
46.1 %
29.0 %
Virginia Beach, VA
17,589
40,936
23,347
37.5 %
26.7 %
Providence, RI
22,606
38,509
15,903
46.6 %
29.8 %
Jacksonville, FL
14,373
33,192
18,819
42.9 %
30.4 %
Milwaukee, WI
12,762
31,375
18,613
36.9 %
21.2 %
Oklahoma City, OK
11,669
33,848
22,179
29.5 %
24.6 %
Raleigh, NC
16,976
31,461
14,485
40.0 %
23.5 %
Memphis, TN
3,098
21,070
17,972
33.7 %
30.6 %
Richmond, VA
15,389
28,394
13,005
36.2 %
23.0 %
Louisville, KY
8,051
24,876
16,825
29.5 %
22.2 %
New Orleans, LA
3,012
21,152
18,140
32.0 %
31.3 %
Salt Lake City, UT
28,098
38,280
10,182
52.7 %
23.6 %
Hartford, CT
13,445
25,704
12,259
33.0 %
25.1 %
Buffalo, NY
13,341
24,838
11,497
32.3 %
24.1 %
Birmingham, AL
3,237
19,145
15,908
30.3 %
25.3 %
*
Ordered by market size
**
Mortgage and rent burdens show the share of a median household’s income needed for the typical monthly mortgage or rent payment in each metro area
Sources and Methodology
This study uses the American Community Survey to provide a simple count of the number of families living in other families’ housing units. The number of families that do not currently own a home is estimated from IPUMS USA by counting each family in each household using the FAMUNIT variable and the appropriate weights. There can be multiple families either living in rented households or living in owner-occupied homes. To estimate the housing unit deficit, we compare families that were living in another family’s home with the number of units for sale or for rent across the country in the same time period.
About Zillow Group
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1 Latest sample available of the U.S. Census Bureau’s American Community Survey
SOURCE Zillow
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