The ‘haunted’ housing market’s real problem may be too few people, not too few homes, says J.P. Morgan’s David Kelly

J.P. Morgan chief global strategist David Kelly says the U.S. housing shortage may be a demand problem rather than a supply problem, estimating the country now needs just 320,000 new homes a year, down from roughly 1 million, as immigration enforcement slows population growth. Kelly argues that fewer households forming—driven by reduced immigration—could ease the "haunted" housing market's inventory pressures, with implications for homebuilders, mortgage lenders, and home prices. The comments challenge the prevailing narrative that underbuilding is the root cause of affordability issues, suggesting population dynamics may matter more than construction rates. Investors should watch immigration policy developments, household formation data, and housing starts figures to gauge whether demand-side weakness continues to reshape the market outlook.