The almost-behind-us month of April is National New Homes Month. After a slump in permit issuance, the number ofÂ new homes being built in LouisvilleÂ and around the country is way up. Elite Homes, Inc. a local builder, reports rising traffic in model homes that exceeds that at the top of the housing boom in 2006. Key Homes, LLC reports the same and expects a 40% increase in new home sales this year.
Why The Increase In Housing Starts?
An improving economy, low mortgage rates, pent-up demand for new housing, and a shortage of properties that the current crop of homebuyers want to purchase are all contribute to this increasing interest in new construction. For homebuyer, new construction offers a viable alternative to the declining inventory of what is currently on the market. As theÂ National Association of RealtorsÂ said recently, the limited inventory of homes, particularly at certain price points, leaves many buyers scrambling to find what they want, hold back sales, and puts many properties in a bidding war.
In March 2003, there were nearly 4,000 homes on the market in Louisville. While that might sound like a sizable number, there is no guarantee that what was on the market matched the desires of an individual buyer for location, number of bedrooms, price, and amenities. While we won't run out of houses, the ones that first time buyers or first-time move-up buyers want are in short supply.
I've Seen The Inventory Shortages
In Louisville, I have seen the impact of decreasing inventory over the last year, as desirable homes I have listed one day have sold quickly after receiving multiple offers. That cute updated home in Germantown that I listed on Friday was but a memory on Saturday, and I expect to get additional inquiries this week from people who've just seen the listing on Trulia or on Zillow.
This situation is positive news for sellers who kept their home off the market out of fear they would lose money after waiting months sell it. With the rush on to find housing, sellers who have homes in good condition that are priced right won't have to wait long to find a buyer and move on to find their next home. Home prices are steadily increasing, so sellers can list higher and perhaps even benefit from bidding wars too.
Consider New Construction
For prospective home buyers, new construction offers the chance to be the first ones live in a clean property that does not bear the holes from somebody else's pictures and the traces of someone else's often mystifying taste. Depending on when you contract for the home, you may be able to select many features and add upgrades while keeping the price reasonable. For upscale custom-built homes, the sky's the limit on possibilities.
If you're looking for a home, new construction may offer an appealing alternative to you. There are several new subdivision building sites in Louisville, plus there are endless opportunities for custom building. I can help you work out the details.
I'mÂ Jessica Gaines Jarboe, a local agent who has lived here all my life. CallÂ Louisville Gaines Real EstateÂ today to discuss new construction when buying your new home or selling your current home.
P.S. Wondering about the economic impact of housing construction on the local economy? Check our next blog.