The Housing Industry Never Recovered From the Great Recession

After the Great Recession , with a glut of foreclosures on the market and prices falling fast, America simply stopped building homes.

New private home starts plummeted by almost 80 percent to the lowest level since 1959 .

The housing market has been subject to a form of hysteresis. It’s an underappreciated but important challenge to the crisis of undersupply.

D.R. Horton , the largest homebuilder in the country, boasts to investors that it is now the largest player in three of the top five housing markets.

The rise of big-box hardware stores like Home Depot has helped drive this, as suppliers merge to gain their own market power, as well as private equity firms buying up companies.

The ideal time to build would be during a recession or when the private market is slack, writes Aaron Miller .

Miller : Monopolists that have gotten fat and lazy will tend to lose out over time.

Miller says government should build and own a substantial portion of the national housing stock.