Don’t Expect Homebuilders to Fix Our Housing Crisis

America has a housing inventory crisis. The number of available homes for sale is down 40% from this point last year, driven partly by homebuyers taking advantage of low interest rates to get more space during the pandemic.

This has been good news for homebuilders; the iShares U.S. home construction exchange-traded fund recently hit an all-time high. But new-home construction was weaker than expected in August, according to Thursday’s housing-starts report from the Census Bureau. And the latest earnings report from homebuilder Lennar Corp. is a reminder that, while these companies will increase production in response to high demand and low inventory levels, their mission isn't to ensure an adequate housing supply for Americans. That's a task for government, not for-profit corporations.