The New Housing Boom Could Be Coming

Fool.com contributor Morgan Housel chimes in on what could be the first steps of a new housing boom. 

Morgan points out that in the lead up to the housing crisis, we were building about 700,000 more homes than we needed each year, and now we're about 500,000 homes shy of what we should be building each year. 

After a few years of moving through excess inventory, it looks like we could be on track for another boom -- the U.S. economy looks able to support about twice as many homes as we are currently building each year.

To learn more about one of the companies that could benefit most from this turnaround, I invite you to check out our in-depth company report on Bank of America. The report details Bank of America's prospects, including three reasons to buy and three reasons to sell. Just click here to get access.


Read/Post Comments (1) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 12, 2012, at 10:16 AM, MKArch wrote:

    I've been on the home builder and Bank bandwagon for years now based on the inevitable rebound in housing that's now finally under way for the reasons you point out. In regard to the difference between home formation and new home construction you forgot to add in demand from units lost each year which when added to the 1.3M households formed gets demand for new home construction to ~1.5M units per year. This is also the long term 50 year+ average for new home construction.

    Just as a frame of reference there was never a year since new home construction was tracked in for the last 50+ years where new home construction was less than 1M units until this recession. I dipped to 0.8M in 2008 and was at ~0.5M every year since until an uptick to the 0.7M pace recently. I've done exceptionally well betting on this recovery early on and expect to keep doing well as the rebound in home building has just barely started.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2107508, ~/Articles/ArticleHandler.aspx, 12/26/2014 8:39:19 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Apple's next smart device (warning, it may shock you

Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early-in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!


Advertisement