Experts tell Connecticut lawmakers housing shortage driven by low inventory, high costs and aging stock

Dr. Yuan, an economist who presented the state housing overview, told a Connecticut legislative housing forum that the state’s housing market is constrained by very low inventory and an aging housing stock, and forecast mortgage rates settling at a new normal around 6 to 6.5 percent.

The presentation and follow‑up panel, which included Bob Weidman of the Home Builders and Remodelers Association of Connecticut and Danushka Naniyakara Skillington of the National Association of Home Builders (NAHB), examined demand and supply drivers, construction costs, and possible state and federal policy responses.

Dr. Yuan opened by describing inventory as “very, very low” and said that while inventory shows some increase it remains well below historical norms. He emphasized that a portion of homeowners are “locked in” to low mortgage rates — particularly those with rates below 3 percent — which reduces turnover and further depresses available supply. “I think it will settle down at a new normal of 6 to 6 a half percent,” Dr. Yuan said of long‑run mortgage rates.

Why it matters: Lawmakers and builders said the shortage is pushing prices and rents higher, squeezing first‑time buyers and renters and reducing the number of starter homes available. NAHB data presented at the forum estimated a nationwide shortage of about 1,500,000 housing units; presenters said Connecticut’s most recent available estimate showed a deficit of roughly 9,400 units for sale and 14,500 rental units (data year: 2021).

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