Nearly 6.5 Million Homes Classified as Inadequate in 2023

In 2023, 6.45 million homes, equivalent to about 5% of the U.S. housing stock, were classified as inadequate, according to the National Association of Home Builders and the American Housing Survey. Of those, 1.65 million were classified as severely inadequate. 

According to the U.S. Department of Housing and Urban Development, physical adequacy is based on whether a home meets the basic standard of “a decent home and a suitable living environment.” Severe inadequacy is characterized by major deficiencies like exposed wiring, lack of electricity, missing hot or cold running water or the absence of heating/cooling systems. If a home exhibits at least five significant structural issues, it also belongs to this category. 

Likewise, moderately inadequate homes have three to four significant structural issues or have other less severe problems. 

Housing inadequacy has fluctuated slightly over the past decade, but it has not decreased significantly. The number of inadequate homes in 2023 (when the latest data was collected) was only down about 0.25 million from 2021. In the past decade, the numbers of inadequate homes from 6.9 million in 2015 to 6.5 million in 2023. 

Older homes are more likely to be classified as inadequate. In 2023, homes built before 1940 had the highest inadequacy rate of 9%, compared to 3% for those built after 2000. 

Additionally, there were more inadequate homes in smaller metropolitan areas compared to major metropolitan areas, and non-metro areas had the fewest. The numbers for 2023 were: 

Moderately inadequate: 

• Smaller metro areas: 50% 
• Major metro areas: 30% 
• Non-metro areas: 20% 

Severely inadequate: 

• Smaller metro areas: 44% 
• Major metro areas: 38% 
• Non-metro areas: 18%