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Nearly 19 Million Vacant Homes Nationwide. Why? July 27, 2009

Posted by John Watch in AccuriZ Reports, News Feed.
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Reported from Bloomberg.com

According to the U.S. Census Bureau and additional public records, 18.7 million homes stood empty in the U.S. during the second quarter. (This includes foreclosures. residences for sale and vacation homes.) While there are many reasons why so many homes are vacant, one could attribute the housing boom and the excess overflowing into its subsequent bust as a significant contributor.

In a market report titled ‘Housing In Crisis,’ AccuriZ noted a trend in the property data of vacancies from 2000 to 2008 as a key indicator of over development during that period. The chart below indicates an increase in housing units covering the latest development time period. (Seasonal units are removed from this count).

Vacancy Chart in Housing In Crisis

Source: AccuriZ.com

 “Vacant units are segmented into occupied and renter units offered for sale and units being held vacant. At 17 million units the vacany level increased to 13.8% versus historical levels below 10%. During the last real estate correction in the late 80’s and early 90’s, vacany increased to 10%.”

What’s interesting to note is that the level of construction and the amount of vacancies have increased more rapidly than in previous decades, in a shorter period of time (8 years). This clearly indicates a surge in construction that sent the market plunging. As we head into the second half of 2009, the trend continues as foreclosures and unemployment have made a tremendous impact.

There are many factors attributing to the rise in vacancies, but it can be clearly seen that the foundation of this increase began with the amount of contruction in this period. The construction was, and has been too much to absorb.

For the complete ‘Housing in Crisis’ report including Housing Affordability, Ownership vs. Renting and more, CLICK HERE.

What do you think is the most important factor attributing to the rise in vacancy rates?

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