Tight mortgage lending standards are still plaguing the housing recovery, says Stuart Miller, CEO of homebuilder Lennar.
Housing starts are averaging about a million per year right now, still well off from the 1.5 million that is considered more normal for the economy. In 2009, housing starts fell below 500,000 but have been gradually increasing since.
Lennar, one of the nation’s largest builders, is predicting a gradual recovery that will likely stretch over the next three to five years.
“The mortgage market is not enabling demand to form at normalized levels,” Miller tells CNBC. He notes that there has been insufficient growth in the number of households as the Millennial generation doubles up and lives at home with their parents.
“We’ve been under-producing what’s needed for a growing population and for what should be normalized household formation,” Miller says.
Source: “Housing is still 30% below normal: Lennar CEO,” CNBC (June 4, 2014)