Nobody can quite agree on how big America's housing shortage really is—and that's part of the problem. As The Washington Post noted, every major institution has its own estimate of the gap, leaving policymakers and developers with little common ground for how to fix it.
Zillow says about 89.1 million families are "doubled up," sharing homes with people outside their households and estimates the national housing deficit reached 4.7 million units by the summer of 2025. McKinsey estimates the shortfall to be much higher, at 8.2 million units in 2023 and possibly 9.6 million by 2035.
Goldman Sachs economists estimate three to four million new units would be needed to restore affordability. The Brookings Institution calculated the 2023 shortage at 4.9 million homes compared with mid-2000s levels. The National Low Income Housing Coalition said 7.1 million affordable homes were missing, while Freddie Mac's 2024 estimate stands at 3.7 million. House Republicans claim the gap is a staggering 20.1 million units.
That wide range reflects how differently experts interpret the data—how they define "household," measure demand or calculate a healthy level of vacancy. As Brookings explains, a household can mean a single person living alone, a family or unrelated people sharing space.
In 2023, the U.S. population totaled 334.91 million, spread across 131.43 million households. The think tank defines a shortage as the point at which the quantity of homes supplied is less than the quantity demanded at current prices.
But defining a shortage isn't as simple as supply versus demand. Brookings notes that affordability complicates the picture. Many higher-end homebuilders now face their largest glut of unsold houses in 15 years, unable to sell to most buyers. That raises a tricky question: Does an oversupply of homes that few can afford still count as a shortage?
Brookings' analysis also shows how the pace of homebuilding has slowed dramatically. In cities such as Atlanta, Dallas, Detroit, Los Angeles, Miami and Phoenix, annual growth in housing stock averaged 4.44% to 14.93% in 1950. Now it's between just 0.24% and 0.94%.
Zillow found that in 2023, about 3.4 million homes were vacant and available for rent or sale, while 8.1 million families lived with non-relatives. Its analysis assumes most of those families would prefer their own homes.
As The Washington Post reported, housing, like employment, depends on some level of turnover. A healthy housing market requires a certain share of vacancies, just as the labor market requires some unemployment. Experts say a vacancy rate between 3% and 13% keeps the system functioning smoothly.
With so many variables and assumptions in play, that's why estimates differ so widely. For real estate developers and policymakers hoping to close the gap, the first step may be agreeing on its size.
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