Trulia estimates backlog in household formation at 2.4 million
By: Paul Hagey – Staff Writer
Household formation, especially among young adults between 18 and 34 years old, lags far behind historical norms but will bounce back slowly in the years ahead, according to a recent analysis by Trulia Chief Economist Jed Kolko.
Before the housing bust, an average of 1.1 million households — defined as one or more people who live in the same home — were formed each year in the U.S.
The reduced rate of household formation during the bust — about 450,000 households formed each year from the first quarter of 2008 to the first quarter of 2011 — helped create an estimated backlog of 2.4 million households that should be factored into forecasts for the coming years, Kolko said.
“Household formation is the most important indicator of the housing recovery that isn’t doing well,” Kolko told Inman News.