The Entire US Housing Market In One Chart

Last night's IPO filing of American Homes 4 Rent - the latest large "own to rent" vehicle scrambling to cash out while the cashing out is good (if not for its peer Colony which pulled its IPO as we reported last night) may or may not pull the "market conditions" card, but it did provide for an informative S-1 filing, where among other things one can find the following one-chart schematic summarizing the entire US market.

In short:

  • Residential housing is the single largest "tangible" US real estate asset, worth roughly $18 trillion (but well below the total financial assets in circulation in the US).
  • Housing inventory as of May was 133.2 million units, of which owner occupied is 78.9 million, renter occupied was 41.7 million, but most troubling: 12.6 million was Vacant. Some shortage.
  • Of the Owner-occupied units, 3.3 million units were 90+ delinquent or in foreclosure, 2.0 million units were 30-90 days delinquent, and 5.8 million were current but with negative equity.
  • It is this mismatch between 11.1 million in negative equity "owner occupied" units and 12.6 million vacant units that all those who peddle the rent-to-own dream are focused on as America becomes increasingly a society of rents.
  • It also means that the millions in soon to be formerly owner-occupied homes (once the anticipated switch to rental ownership takes place) have to stay on bank books and not enter the market in other to generate the illusion of scarcity (see: foreclosure stuffing), or else the myth that there is a housing shortage will be blown right out of the water.