by CalculatedRisk on 2/26/2012
Last week the Census Bureau released the placements of manufactured homes in December and for all of 2011. Placements were at 3.4 thousand in December, and at a record low of 46.0 thousand for all of 2011.
Although the manufactured home data only goes back to 1980, it is pretty clear that total housing completions (single and multi-family) and manufactured home placements were at record low levels since at least the early ’60s. Here is a table of the worst years on record:
|Worst Years for Housing Completions and Placements|
|Year||Total Completions (000s)|
Unfortunately there is no timely count of household formation, so it is hard to tell how quickly the excess supply of housing is being absorbed.
Note: Household formation is a function of changes in population, and also of changes in household size. During the ’70s, the baby boomers started moving out of their parents’ homes, and there was a dramatic decrease in the number of persons per household and that led to a huge demand for apartments. We can’t directly compare the level of total completions in the ’00s to the ’70s or ’80s – we need to know the number of households being formed.
This graph shows total housing completions and placements since 1980. The net additional to the housing stock is less because of demolitions and destruction of housing units.
Although we don’t know the exact number, it is pretty clear that there are more households being formed than housing units completed last year – and the excess supply is being absorbed.
- Buffett’s Views on Housing (woodonfire.wordpress.com)