While the Memphis metro area continues to face a housing shortage, a new Zillow analysis shows the region is moving in the right direction.
According to the latest U.S. Census data, the Memphis metro had a housing deficit of 1,543 homes in 2023. Despite this shortfall, the number of new homes added in the area rose by 1,807 from 2022 to 2023—an encouraging sign of progress.
Inventory is also improving. As of June 2025, there were 4,518 active listings in the Memphis metro area, up from 3,627 in June 2024, according to the Memphis Area Association of Realtors.
Among the nation’s 50 largest metro areas, Memphis had the smallest reported housing deficit, putting it in a better position than most major U.S. cities. Nationally, the housing shortage reached an all-time high of 4.7 million units in 2023. That figure is based on Census data showing 3.4 million homes were vacant and available, while 8.1 million families were living in shared households with people they weren’t related to.
“The unfortunate fact is that we still don’t have enough housing in this country for people who need it,” said Zillow senior economist Orphe Divounguy. “Construction has helped prevent the housing deficit from ballooning, but it hasn’t yet begun to close the gap.”
Divounguy emphasized the importance of easing building restrictions and promoting higher-density development to help reduce costs and increase supply.
Nationally, the housing stock grew by 1.4 million homes in 2023, up from 1.3 million in 2022. Builders completed 1.45 million housing units in 2023 and 1.63 million in 2024—both the highest annual totals since 2007.
Still, the gap between supply and demand persists. The U.S. housing deficit expanded by 159,000 homes in 2023, though that increase was smaller than the 257,000 deficit growth seen in 2022.
While major metros like New York (402,361), Los Angeles (338,750), and Boston (150,541) continue to struggle with significant housing shortages, only a few areas reported deficits below 10,000. Along with Memphis, those included Birmingham (5,966) and New Orleans (4,234).
In comparison, Nashville had a housing deficit of 34,843 in 2023. Like Memphis, Nashville saw a year-over-year improvement, reducing its shortfall by 1,142 homes.
