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| National Association of Realtors - Lawrence Yun Economic Forecast |
Accordingly, the selection of homes available for buyers to purchase has been unprecedentedly low. Home buyers that had once only been able to choose from the existing homes that were listed for sale in a particular location are now encountering an increasing number of options from new housing subdivisions and custom home builders. Why buy old when they can custom tailor a new home with the size, colors, amenities, and layout, all on the size and location of the lot that they select? Not to mention, builders often offer incentives like buying down interest rates and paying for closing costs.
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| National Association of Realtors - Lawrence Yun Economic Forecast |
This relative lack of housing inventory has begun to give home builders increased confidence to start building new homes in greater numbers. Both housing starts and builder confidence are again rising at a steady clip. Increased home prices have also enabled builders to realize a profit on their newly constructed homes.
Housing developers are clearly seeing a market loaded with buyer demand and very low housing supply. History dictates that economic markets this far out of balance will always correct themselves. So look for increased competition from new homes in the foreseeable future.
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