Since 1960, construction and job growth have run parallel to one another, maintaining a seemingly symbiotic relationship that has helped shape and ultimately define the homeowner landscape. For more than half a century, national construction levels have been largely determined by job growth, with builders following a simple ratio of one single-family home for every 1.5 jobs created. That ratio has held firm through economic dips, legislative battles, government shifts and a countless slew of national calamities, but as we look back at the most devastating recession since the Great Depression, it becomes unclear, at least in the short-term, whether we should maintain the battle-tested status quo or move towards a more innovative and malleable strategy that takes into account contemporary hurdles.
In a study released by the National Association of Realtors, an in-depth evaluation of the country’s construction activity over the last three years revealed that while more than a dozen states were keeping to the old building standard, the majority were failing to keep pace. The association immediately branded the finding as a negative indicator, suggesting that a dip in construction was the first step on the path to exacerbated housing shortages and rising home prices. But in a rebuttal, made via an article published by The Wall Street Journal, the National Association of Home Builders rejected these claims, saying that instead of seeing the developments as a red flag, we should be reevaluating the short-term use of the 1:1.5 ratio, and looking at the industry as a whole to see what affect the recession and new trends in homebuilding were having.
In Chicagoland, despite being a unique market, the question remains the same as anywhere else: What do people want, and what are builders building for consumers?