Seriously... Low housing starts a surprise, so that's why the market is down today.
Why would we need more new homes when people can sell what we have now. But really here is the issue that we have talked about before.
The median home buyer is 39 years old, so half are older and half are younger. The number of people now over 39 is larger than the people under 39 but over 18. The universe of people who can buy homes. We do have a decent size population of 15-19 years olds (3.69% male, 3.49% female) that will need to take the place of the retiring baby boomers and those over 55 who aren't buy new homes, they are selling. So you have in the population distribution twice as many people already in their home or selling their home to retire as the largest bracket of home buyers - 25-44 (54% of buying). So the basic problem is there aren't enough 25-44 year olds to buy all the homes of those 44-85. That's not going to change for a little while and it didn't sneak up on us. So lets stop acting so surprised!