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February 2017   Volume 43, Number 2      
 

5

Increased Homebuilder Confidence, but They’re Not Building New Homes

A monthly survey of homebuilder confidence for December 2016 found that this figure spiked to its highest level in 11 years. However, a Commerce Department report for the same period found that new home construction declined by 18.7 percent.

“During the course of the recession, the builders, being entrepreneurs, were sometimes more optimistic than the market has been. I think as we come back to normalcy, you’ll see a pretty parallel track,” said Jerry Howard, NAHB’s CEO. “They have to be optimistic, or they have to get into another profession.”

Some analysts believe that the discrepancy between homebuilder optimism and the decline of new housing starts is due to the fact that there is high demand for housing and a very low supply of homes. However, homebuilders are still not building because they are facing huge labor shortages and new regulations that are increasing their costs.

The costs of land and materials are also rising and there are shortages of finished lots available in the neighborhoods where people want to live. Finally, homebuilders are continuing to approach homebuilding with caution after having survived the previous housing crash, which was the worst in U.S. history.

 

 

 

 

In this issue:

Tiny Home Neighborhoods Are Popping up Across America

Chinese Developers Reassess U.S. Projects

Commercial Real Estate Market Sees Mixed Results After Election

First-Time Homebuyers Struggle to Find Affordable Homes to Purchase

Hiver CEO Predicts Major Tech Trends in Real Estate for 2017

Homebuilder Confidence Has Increased, but They’re Not Building New Homes

Newly Created S&P 500 Real Estate Sector Continues to Decline

Redfin Predicts 2017 Will Be the Fastest Housing Market on Record

Russian Interest in U.S. Real Estate Increases After Trump Election

Rising Sea Levels Are Forcing Agents to Rethink How They Sell Coastal Properties


 


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