More New Homes Are Coming Soon

With the lack of homes on the market here in the Tampa Bay area. Homes having multiple offers on them within hours of hitting the MLS. The news of more new homes was very encouraging to say the least. The majority of the builders literally stopped building and carrying any inventory homes after the crash of the housing market. So for our buyers who were looking for new construction, they had to wait for the home to be built. But we would have buyers who could not wait 6 to 8 months for a new home. They were coming to Tampa now!

Builders are beginning work on more single-family homes across the country, that could offer some much-needed inventory relief for numerous housing markets. Housing starts nationwide are up nearly 31 percent year-over-year. In February, housing starts jumped 5.2 percent alone on a month-over-month basis to a seasonally adjusted annual rate of 1.178 million units, the Commerce Department reported Wednesday. Broken out, single-family production rose 7.2 percent month-over-month to 822,000. That is the highest level since November 2007. Meanwhile, multifamily starts mostly held flat last month.

“It means that home builders are responding to the demand out there,” says Jonathan Smoke, realtor.com®’s chief economist, about the new report. “We don’t have enough supply of homes to keep up with the increase” among a growing number of buyers entering the market.All four regions of the U.S. posted gains in housing starts last month, except the Northeast. The West posted the largest month-over-month gain as new-home starts climbed 26.6 %, accompanied by a 19.9 % increase in the Midwest, and a 7.1 % rise in the South. The Northeast, however, posted a 51.3 percent month-over-month decline in February.

Overall, “February’s single-family gains indicate that this sector is strengthening in line with our forecast,” says David Crowe, chief economist of the National Association of Home Builders. “As the U.S. economy firms, job creation continues and mortgage interest rates remain low, we should see further growth in housing production moving forward.”

However, the number of new permits – an indicator of future building – did post a drop in February in comparison to January. That may signal at least a brief slowdown. Permits fell 3.1 % in February month-over-month, but most of this was related to an 8.4 % drop in multifamily permits. Single-family permits inched up 0.4 % to 731,000 in February.

A turnaround is likely to be coming to the Northeast, with permits rising 40.4 % in February. However, the Midwest posted an 11.4 percent decrease in permits, the West saw a 7.2 percent decrease, and also the South had a 4.4 percent drop in permits.

Nick & Cindy Davis have a team of agents ready to assist you. We have our finger on the pulse with new construction and resale homes as well. If you need someone to assist you, we are always just a click here or call to 813-300-7116 away.

Source: National Association of Home Builders and “Good News for Buyers: More New Homes Are in the Pipeline,” realtor.com® (March 16, 2016)