Alabama Ranks 21st Among States Building the Most Homes

Photo Credit: Ungvar / Shutterstock

 Shutterstock

Across the United States, a persistent shortage of housing has fueled an ongoing affordability crisis, particularly in high-growth metropolitan areas. Over the past several years, high housing costs have stretched budgets for both homebuyers and renters alike. From the first quarter of 2020 to the first quarter of 2025, the median home sales price rose by nearly $88,000, while rents continue to increase faster than the overall rate of inflation.

Although higher interest rates since 2022 have cooled the housing market somewhat, they have done little to address the underlying supply shortage. Most estimates place the shortfall between 2.5 and 5.5 million units, reflecting years of underbuilding relative to population growth. While existing home inventory has increased, it remains well below pre-pandemic norms. At the same time, new construction continues to face significant headwinds. As of June 2025, the National Association of Home Builders (NAHB) Housing Market Index fell to 32, reflecting weakened builder confidence in the face of elevated mortgage rates and high construction costs.