“We probably had 10 or 12 years of zero building, or very limited new construction, so we’re behind the eight ball to start,” he said. “This is sort of the follow through of that.”

Despite this, he believed the US mortgage sector was essentially sound. “The market is vibrant, and I think it’s solid, and we think it’s safe for people to jump in,” he said.

Read more: No magic bullet for housing shortage, says chief economist

He was, however, under no illusion about the difficulties many thousands of Americans who want to buy a home are facing. “You need to build affordable housing, but affordable housing is very expensive to build – so it’s really not affordable,” he explained.

“So how do you do that? I think the answer is the repatriation of existing homes, or the rehabilitation of homes. You take auxiliary dwelling units that are sort of dysfunctional – what they call in California ‘granny flats’ – where you’re taking garages that are detached, or you’re taking property and you’re building on to larger units. It’s much cheaper to do.”