Homebuilders Still Look Good

In the 50 years ending 2006, housing starts in the U.S. averaged 1.5 million annually. Interestingly, in 1972 we built 2.5 million homes when the U.S. population was 200 million. Fast forward to 2006, which was the height of the real estate bubble, and we built 2.6 million homes, the difference being the population had grown to more than 300 million.

On average, it takes about 75 years to turn over the nation's housing stock entirely when averaging about 1.5 million units annually. However, since 2008 we've averaged only about 690,000 housing starts annually. Given the historical average, that is less than half what we need to keep up with demand if we are going to have enough housing for a growing population and if we are to avoid seeing our housing stock become totally dilapidated. The shocking truth is, at the current rate of construction it would take 217 years to turn over our existing housing stock, which means that we are concocting a recipe for lots of blighted cities and neighborhoods as homes all across the nation fall into disrepair. Of course, that's if you're going to accept that it will stay at the current, highly depressed rate of construction. I am not. Being a betting man, I'm betting that this won't be the case....393 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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