NEW CONSTRUCTION FORECAST FOR 2017: INCREASED NEW HOME SALES

Friday, April 28, 2017   /   by Mike Shoaff

NEW CONSTRUCTION FORECAST FOR 2017: INCREASED NEW HOME SALES

The NAHB (National Association of Home Builders) new construction forecast points towards an increase in new home sales. Economists evaluated the growth of families, a strong economy, and employment gains as fuel to support the demand for new home construction.

Although the demand will support the growth of new construction, the supply of the three “L’s”: Lots, Labor, and Lending can dampen certain markets.
Lots: Over 60% of the nation’s builders report the lack of supply of available & buildable land. In Collier County, we have been witnessing the resurgence of independent builders as well as national firms. Golden Gate Estates has single family home construction on vacant lots of various sizes. The price of residential acreage has increased annually creating more demand to buy sooner than later.

Many larger builders are scooping up acreage to build communities with a handful of homes, many without any amenities common to the larger developments.
Labor: The demand for housing has left some jobs unfulfilled, yet continued economic growth and rising wages has added some balance to the labor deficit.
Lending: Mortgage rates may increase over time but can be offset by stronger wage gains and job increase. An increase in housing demand will ensue. To maintain balance in the new construction market, new home prices will need to be moderate and not far exceed home demand.

Construction loans are on the rise but not keeping pace with the need for new homes. Regulations have discouraged many banks from underwriting loans on “dirt,” and the less risky multifamily dwelling developments that offer solutions to those would-be homeowners who need to rent due to rising home prices.
Regulatory costs can average 25% of total building costs which contributes to the lack of entry level lower priced new homes. Millennials have entered the housing market and townhouse construction has been the bridge to home ownership.
Affordability will be a major issue in 2017 along with housing supply.  Mortgage rate increases will be moderate while single -family production will rise 10% this year and 12% in 2018.

RE/MAX Hallmark Realty
Mike Shoaff
821 5th Ave South Suite 105
Naples, FL 34102

The source of this real property information is the copyrighted and proprietary database compilation of the Southwest Florida MLS organizations Copyright 2024. Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. The property information herein is derived from various sources that may include, but not be limited to, county records and the Multiple Listing Service and it may include approximations. Although the information is believed to be accurate, it is not warranted and you should not rely upon it without personal verification.
The source of this real property information is the copyrighted and proprietary database compilation of the Southwest Florida MLS organizations Copyright 2024. Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. The property information herein is derived from various sources that may include, but not be limited to, county records and the Multiple Listing Service and it may include approximations. Although the information is believed to be accurate, it is not warranted and you should not rely upon it without personal verification.
2024 Royal Palm Coast REALTORĀ® Association. All rights reserved. Information has not been verified, is not guaranteed, and is subject to change. The data relating to real estate for sale on this web site comes in part from the Internet Data Exchange (IDX) of the Florida Gulf Coast Multiple Listing Service, Inc. Real estate listings held by brokerage firms other than Mike Shoaff - RE/MAX Blue Skies IDX logo and detailed information about them includes the name of the listing brokers. The information being provided is for consumers personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Last Updated: 4/21/2024 3:33 PM CST
The data relating to real estate for sale on this limited electronic display comes in part from the Southwest Florida Multiple Listing Services. Properties listed with brokerage firms other than Mike Shoaff - RE/MAX Blue Skies are marked with the BR Program Icon or the BR House Icon and detailed information about them includes the name of the Listing Brokers. The properties displayed may not be all the properties available through the BR Program. The source of this real property information is the copyrighted and proprietary database compilation of the participating Southwest Florida MLS organizations and is Copyright 2017 Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. Some properties that appear for sale on this limited electronic display may no longer be available. For the most current information, contact Mike Shoaff - RE/MAX Blue Skies Data last updated 4/21/2024 3:33 PM CST.
The source of this real property information is the copyrighted and proprietary database compilation of the Southwest Florida MLS organizations Copyright 2024. Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. The property information herein is derived from various sources that may include, but not be limited to, county records and the Multiple Listing Service and it may include approximations. Although the information is believed to be accurate, it is not warranted and you should not rely upon it without personal verification.
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