If you are in the process of looking for a home today, you know the supply of homes for sale is low because you are feeling the impact of having a limited pool of options. And, if your biggest hurdle right now is that you are having trouble finding something you like, don’t forget that a newly built home is a great option.
Here’s a look at a key metric that shows just how much new home construction is ramping up nationwide. The graph below uses data from the Census to show the trend of new home completions over time, including the long term average for the number of finished housing units.
As you can see on the left (shown in orange), leading up to the housing crash, builders exceeded that average. The result was an oversupply of homes on the market, so home values declined. That was one of the factors that led to the housing crash back in 2008.
Since then, the level of new home construction has fallen off. Builders haven’t built enough homes to meet the historical average (shown in red). That underbuilding left the housing market with a multi-year inventory deficit. And, that deficit is part of what makes inventory so low right now.
But, here’s the good news! The green on the right shows that according to the latest report from the Census, builders are matching the long term average right now. And, that means they are bringing more newly build homes to the market than they have in recent history.
And, residential starts and permits are also gaining momentum. Starts are homes where the construction has officially kicked off. Permits are homes where builders are planning to break ground soon. Since both are up, it’s a sign there are even more newly built homes coming soon.
What This Means for You
More newly built homes in various stages of the construction process means your pool of options just got bigger. If you are looking to move right now, contact me to explore the homes that were recently completed in your area.
But, if you can wait a bit and the idea of customizing a home from the ground up appeals to you, contact me. I will explore the homes in your area that are under construction.
Bottom Line
So, if you are having trouble finding a home you like while inventory is so low, it may be time to consider looking into new home construction. Contact me to discuss your options.