– I keep hearing the housing market in the USA had such a price surge because of demand increase and a lack of housing. Why did happen all of a sudden? There wasn’t some huge increase in people too.

Question

Secondly- What would it take for prices to change?

In: Economics

Answer 1

It isn’t entirely true that there hasn’t been a huge increase in people. It’s true that the population has not increased dramatically. However, the proportion of people who now live alone or desire to live alone has. People are no longer content to live at home until they marry (in the broadest sense of the word). Add to that the increase in numbers who actually choose to remain single lifelong and the number of those newly made single by divorce and you have additional pressure not only on the number of homes needed but also the type of accommodation required. As others have described, it’s probably not the most significant factor but it certainly needs to be taken into account.