The housing market is facing an inventory shortage, and the work-from-home boom makes it worse

• The US housing market is facing a lack of inventory, with Freddie Mac estimating a shortage of 3.8 million units.
• The work-from-home boom has exacerbated existing issues by boosting demand for bigger homes.
• According to CBRE data cited by Axios, apartments built after the pandemic were 10% larger.

The work-from-home boom that began in the pandemic has exacerbated the housing market's tight inventory issues, and it's keep affordability low for buyers.

The pandemic made many companies and individuals realize they didn't need an office for a job, and that sent a large portion of work and workers into residential neighborhoods.

For example, in New York City, the average household fits about 2.5 people per 1,000 square feed, per a Tuesday Axios report.

But if that person works from home, they'll feel cramped unless the property expands by 150 square feet — about a 15% difference in space.

That pushed home demand higher as Americans sought out more space for home offices, putting additional stress on the housing market.

According to CBRE data cited by Axios, apartments built after the pandemic were 10% larger compared to those built the prior decade.

Work-from-home trends have a similar impact in suburban homes, as remote staffers often seek an additional bedroom to use as a home office. This effectively pushes buyers into the next rung up in the housing market.

But the current housing market offers 39% fewer homes for sale than before the pandemic, a recent Redfin report said, and inventory issues are unlikely to resolve themselves anytime soon.

In the four weeks leading up to June 11, the total number of US homes for sale saw its biggest decline in 13 months. Plus, new home listings just dropped 23%, the 10th consecutive month of double-digit declines.