The story features the top 10 counties, all of whom have populations greater than 10,000, with occupancy rates from 54% to 66%. The photos accompanying the story illustrates the reason why capital cannot painlessly be reallocated in a bust, as Paul Krugman would have us believe.
There are several counties in America, each with more than 10,000 homes, which have vacancy rates above 55%. The rate is above 60% in several.
During booms fueled by credit not funded by voluntary savings, some malinvestment is sunk in non-convertible capital goods. Many of these structures now have very little if any economic value and the scarce capital goods used to produce them cannot easily be extracted and converted to other uses. This capital, consequently, is lost and can only be built up again by an increase in voluntary saving.