Definition: A region where locally available investment funds are insufficient to meet financing demand. Funds from other regions or from the secondary mortgage market can help fill that gap.
Example
A growing community needs more mortgage financing than its local deposits alone can support.
Keep the distinction clear
The term describes a shortage of available capital relative to demand, not a physical shortage of land or a guarantee that lenders will fund every project.
Related terms
Capital · Secondary Mortgage Market · Disintermediation
Keep studying
Primary and Secondary Mortgage Markets: Fannie Mae, Freddie Mac, and Ginnie Mae
References: California DRE: real estate glossary
Pronunciation (US): KAP-ih-tul DEF-ih-sit AIR-ee-uh (capitals show stress)
Pronunciation reference: Merriam-Webster
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