There's another reason home prices are increasing, besides a lack of inventory: There aren't enough qualified construction workers. The problem has also resulted in a decline in housing starts, according to the National Association of Home Builders, which reported a drop in new construction in April.
The ripple effect of the dearth of workers is being felt in increased construction time, resulting in higher costs. Contractors say it's difficult to retain workers, who can be poached by competitors.
"Our subcontractors can't get people; they can't start on time; they can't get things done on time," Michael Fink, CEO of Leewood Real Estate Group in Trenton, N.J., told CNN Money. Many of the workers employed during the building boom were immigrants, who returned to their home countries when the housing market collapsed, he added.
In March, 46 percent of the members of the National Association of Home Builders said they have fallen behind schedule on completing construction projects, 15 percent had to turn down jobs and 9 percent cancelled a sale -- all because of the lack of workers.
To remedy the situation, builders are increasing wages, sharing crews with other builders and turning to agencies that train construction workers. The problem is that with business being cyclical, many workers who retired during the housing slump weren't replaced by younger workers. But for the foreseeable future, qualified workers will find plenty of opportunity. The Bureau of Labor Statistics projects job growth at approximately 25 percent between 2010 and 2020.
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