Builders Have Been Playing Catch-Up for 15 Years
You’ve probably seen the headlines: “New home inventory is the highest since the crash.” For anyone who remembers 2008, that kind of news can trigger some uneasy flashbacks. More new construction? Must mean trouble, right?
Not so fast. A lot of what you’re reading online is written to grab clicks, not give context. When you dig into the numbers, the story looks very different.
Why This Isn’t 2008 All Over Again
Yes, the number of new homes on the market is higher than it’s been in years. But that single stat doesn’t tell the whole story. New builds are just one slice of the pie. To really understand inventory, you have to look at both new homes and existing homes—the ones that have already had owners.
When you combine those numbers, it’s clear that today’s overall supply doesn’t even come close to the glut we saw back in the crash years. So even though new construction is up, it’s not the same kind of oversupply that tanked the market before.
Builders Have Been Playing Catch-Up for 15 Years
Here’s the part the headlines usually leave out: builders actually underbuilt for more than a decade after the crash. They pulled back so hard in 2008 that for 15 years, new construction fell way behind what the market needed.
That long stretch of underbuilding left us with a massive shortage—one we’re still trying to climb out of today. Census data makes the picture clear: we overbuilt leading up to the crash (shown in red), then severely underbuilt for years (shown in orange).
Even with the increase we’re seeing now, it would take more than seven years of building at the current pace just to close the gap, according to Realtor.com.
And of course, real estate is always local. Some markets may feel flush with homes, others are still tight. But on the national level, this looks nothing like the run-up to 2008.
Bottom Line
More new homes on the market doesn’t equal another crash. The data shows inventory today is a completely different story.
Curious about what builders are doing right here in our area? Let’s connect and talk through what it means for you.
