This new technology makes new homes affordable
Ric Edelman: It's Wednesday, October 4th. There's no question that we have a housing crisis in America. Half of all renters and 20% of all homeowners spend more than 30% of their income on housing. More than a million people last year spent at least one night in a homeless shelter. The crazy part is that the problem is not a housing shortage. Of the 700 metro areas that are growing in this country, only 26 of them have a shortage of housing. And those 26 are the smallest metro areas. They account for less than 1% of our population.
So no, the problem is not lack of housing. The problem is the price of housing in the past few years, you know the drill. We've had Covid record high inflation, highest interest rates in 20 years, rising rent. We now have 11 million low income households, but only 7 million affordable units for them to live in. And of the 7 million available units, almost half of them are occupied by people with higher incomes. These folks can presumably live in more expensive housing, but they choose not to do so for obvious financial reasons. They're trying to save money themselves. That's good for them, but it's at the expense of low income households who don't have any other options.
The National Association of Homebuilders says half of the nation's households can't afford to buy a $250,000 home. 10% can only buy a $150,000 home. You tell me, where can you buy a house for 150 grand? The nationwide median price for a new single family home is 425 grand. Meaning 75% of all US households can't afford to buy the average priced new home.
Can innovative technologies solve this problem? Yeah. All over the world, 3D printed homes are being built for less than 100 grand. You can find them everywhere, not just poor countries like Africa. But in Austin, Texas, there's a construction company there called Icon. They're building a community of 100 3D printed homes for less than 99 grand a piece. The homes have at least one bedroom and one bathroom. Their target market are singles, young families, people who were homeless and older people who live alone. The houses are cheap because the machines print the walls. They print the floors. They print the roof. You save big on labor costs at the job site, studs for the interior walls and the drywall that covers them are all prefabricated.
There's even a company called Boxabl that makes prefab foldable homes that can be shipped on a truck unfolded at the jobsite. These houses cost only $49,500 for a 400 square foot studio. A company called Node makes prefab homes that are shipped in kits that you assemble, like Ikea furniture. Vantem makes energy efficient prefab homes and automatic construction company is building houses by pumping concrete into inflatable forms. It's like filling a balloon with concrete.
Using 3D printing to manufacture housing is not just about affordability, these houses are better for the environment. They're better insulated, they're cheaper to air condition and heat. The electrical and plumbing piping is safer than traditional methods. That means lower risk of lead poisoning, and they can be built 80% faster with 78% less waste on site, 64% less material, 50% lower labor costs. And they're really pretty. Anybody would be happy to live in one of these homes. We've got some links to photos of them in the show notes so you can see for yourself.
You know, back in 1908, Sears started selling houses to its customers. It was a kit. You ordered it from the Sears catalog and they delivered the house right to your door. Well, not right to your door. They deliver the door to it was all delivered right to your property. The building materials were shipped by railroad and erected at your site. In just three months, Sears sold these houses from their catalog. From 1908 to 1942, there were 400 styles to choose from. All told, they sold 75,000 of these homes, and most of them still exist today in towns all over America. The houses were cheap and affordable and high quality.
Today, 3D printing is about to offer a similar opportunity for households all over the US that are currently shut out of the housing market. Pretty exciting.
You know, investing does not have to be complicated. How about just investing in something you know about? And one thing you know about is food. We spend $1 trillion a year buying food and beverages here in the US. But food is not a stagnant thing. There are trends about what we eat, just like there are trends about fashion and there are some important trends that are shaping the future of food and beverage products.
First is how we buy it. We're buying food online more than ever. By 2027, it'll be 21% of all our food bought online. We're also shifting to healthier products, more sustainable products as well. We don't only want food that's good for us. We want food that's good for the environment. I'm talking about plant-based alternatives, functional snacks, organic and natural food and food that's low in sugar, salt and fat. The food industry is even coming up with new and different products, new flavors, even entire new categories, personalized nutrition, even smart packaging where the product is the same, but it is sold differently.
For example, Coca-Cola has launched a new global innovation platform called Coca-Cola Creations. They are producing limited edition products created by their teams involving marketing, creative design and technology. The first product they created is Starlite. It's a space-themed drink that imagines how outer space might taste. That sounds silly. Your kids love it. And Archer-Daniels-Midland and General Mills, they're using IBM's blockchain technology to trace the origin and quality of the oats that go into Cheerios and Nature Valley brands.
You can scan a QR code that's on the package to see where the oats were grown, when they were harvested and how they were transported. If there's ever a food contamination problem, they'll know exactly which supplies are the issue instead of having to recall every single box. That'll save the companies money and it will let them warn consumers who are at risk faster helping everybody stay safe.
And Constellation Brands, you know, they're best known for Corona Beer and Mondavi Wine, they're now using recycled content in its glass bottles, aluminum cans, cardboard boxes and plastic rings. It's all part of its efforts to protect the environment.
So don't just buy food. Buy shares of an ETF that invests in food innovation. One ETF that does this is the Invesco Dynamic Food and Beverage ETF. The symbol is PBJ. Get it? PBJ... Peanut Butter and Jelly. This fund follows the Dynamic Food and Beverage Intellidex index. It features US food and beverage companies that sell brand name household goods, food, beverages, both alcoholic and nonalcoholic, and other items that consumers love. Talk to your wholesalers at Invesco or go to invesco.com to learn about the Invesco Dynamic Food and Beverage ETF, symbol PBJ. Or if you're an investor, talk to your financial advisor about it.