What a difference two years make when you’re talking about the new home market!
There is an unprecedented pent-up demand for new construction across the country. The recession ending, job creation, lack of new home starts – and now a shortage of desirable resale homes have created the “Perfect Storm” for builders.
With all these positive signs, you would think that builders would be throwing up houses like mushrooms. That is not the case, and as a result, there are many more buyers out there than there are available homes. Buyers are now faced with low inventory – for both resale properties and new construction.
There a myriad of reasons why builders are trickling out new product; and it’s creating a supply-and-demand curve in their favor. In pre-recession times, builders would put up blocks of houses at a time. Now because of conservative policies dictated by banks (or their stock holders), builders have slowed down their production, resulting in low supply and high demand.
What does this mean if you’re in the market for new construction? If you can find a home completed or nearly completed and the sales person tells you to grab it now, that’s not just a sales ploy – it’s sound advice. Just as the resale market has buyers competing for homes, the same holds true for new homes.
So here’s some advice for your next house hunting trip: If you snooze, you lose. Be prepared to act quickly when you find a home that meets your needs.