New data shows a national two million‑unit shortage, exposing hidden deficits in middle‑income neighborhoods despite surpluses in wealthier areas
PHILADELPHIA, July 17, 2025 /PRNewswire/ — PolicyMap, a leading geospatial data platform, in partnership with Moody’s Analytics, Reinvestment Fund, and Urban Institute, today released the first national analysis of America’s housing shortage at the neighborhood level, using census tract data from nearly 350 U.S. cities with populations over 100,000. The study, Bringing the Housing Shortage Into Sharper Focus, surpasses broad national and metro-level estimates to analyze the supply of and demand for housing at the local level.
Specifically, the report identifies a shortfall of about two million homes, and more importantly, it reveals how that shortage varies across neighborhoods. By examining thousands of census tracts, the research shows where supply gaps of homes for owners and renters are most severe and how those local shortages relate to neighborhood income.
“It’s so important to be able to understand this data with this level of granularity,” said Maggie McCullough, CEO and founder of PolicyMap. “We can now see not just how many homes are missing, but where they’re needed, whether they should be rental or owner-occupied, and which income groups are most affected. By partnering with Moody’s Analytics, we combined their estimation model with our granular spatial data to give policymakers a more actionable roadmap.”
A Ground-Level Look at Housing Supply
Unlike earlier efforts that offered broad national estimates ranging from 1.5 to over 7 million homes, this study uses a neighborhood-level approach. It compares local vacancy rates to an “equilibrium” baseline from 2012 to 2018, a period chosen for its relative market stability after the recession and before the disruptions of the COVID-19 pandemic. By analyzing how current vacancy rates differ from those norms, the study estimates where each neighborhood is under- or oversupplied in both rental and owner-occupied housing.
Key takeaways from the report include:
- The deepest shortfalls are in moderate to middle-income rental markets, revealing a widespread gap in what the report terms “workforce rental” housing
- High-income neighborhoods, particularly in large cities, often have a surplus of rental units, creating an imbalance in available supply and actual need
- The ownership market is more balanced overall, although some high-income areas are still tight, while some lower-income neighborhoods show small surpluses
- The national shortage of homes is driven more by a lack of rental housing than homes for sale
- Many cities that appear balanced at the metro level contain sharp neighborhood-level imbalances that are often hidden in aggregated data
“This analysis shows that housing supply is not a one-size-fits-all issue,” said Cristian deRitis, deputy chief economist at Moody’s Analytics. “You can’t solve affordability by adding units in the wrong places. Looking at the census tract level reveals how local mismatches between supply and demand are distorting the broader housing market. Partnering with PolicyMap and Reinvestment Fund allowed us to build a repeatable, data-informed framework that policymakers can use to target solutions more effectively.”
More Than a One-Time Snapshot
A key strength of the study is its ability to be updated over time. Built on annually refreshed American Community Survey (ACS) data, the analysis allows cities, states, researchers, and advocates to monitor how local housing gaps evolve.
“This wasn’t designed to be a report that sits on a shelf,” said McCullough. “Because the analysis is built on ACS data, we can refresh it each year. And since the census tract-level maps are available on PolicyMap, communities can immediately view their local conditions and use that insight to take action.”
By surfacing detailed neighborhood-level imbalances, the study makes clear why broad national policies often miss the mark.
“The utility of this analysis is that traditional shortage estimates aggregated across a city, state or region mask sub-markets of housing shortage and oversupply. But families are not indifferent to price, tenure, and neighborhood, and these data help policymakers and investors better understand and meet the needs,” said Ira Goldstein, senior advisor of policy solutions at Reinvestment Fund.
PolicyMap has published the full census tract-level housing need estimates on its public platform at https://www.policymap.com/data/moodys-housing-shortfall, allowing anyone to explore the maps and access visuals from the study.
Existing PolicyMap subscribers will receive access to the data automatically. Organizations and agencies that wish to access PolicyMap or license the dataset may inquire directly through the platform.
About PolicyMap
PolicyMap simplifies analyzing geographic data. To meet the demand for authoritative, relevant, current location data, PolicyMap offers a mapping and analytics platform, bulk data delivery, and custom solutions. Our tools are used across industries for market intelligence, site selection, impact evaluation, product development, and academic research. For more information, visit www.policymap.com.
About Moody’s Analytics
In an increasingly interconnected and complex operating environment, organizations face challenges in decoding the intricacies of the global economy. The Moody’s Analytics Economics team delivers timely and in-depth data, forecasts, and analysis of the global economy’s latest developments and trends—empowering organizations and policymakers to identify and manage risks, seize new growth opportunities, respond to geopolitical threats, and thrive in an ever-evolving landscape. Learn more at economy.com.
About Reinvestment Fund
Reinvestment Fund is a mission-driven financial institution committed to making communities work for all people. We bring financial and analytical tools to partnerships that work to ensure that everyone has access to essential opportunities: affordable places to live, access to nutritious food and health care, schools where their children can flourish, and strong, local businesses that support jobs. We use data to understand markets, communities, and impediments to opportunity—and how investment and policy decisions can have the most powerful impact. Since our inception in 1985, Reinvestment Fund has provided over $3 billion in financing to strengthen neighborhoods, scale social enterprises, and build resilient communities.
About Urban Institute
The Urban Institute is a nonprofit research organization founded on one simple idea: To improve lives and strengthen communities, we need practices and policies that work. For more than 50 years, that has been our charge. By equipping changemakers with evidence and solutions, together we can create a future where every person and community has the opportunity and power to thrive.
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