New-home construction lags recovery in economy, real estate - Ahwatukee Foothills News: Money

default avatar
Welcome to the site! Login or Signup below.
|
||
Logout|My Dashboard

New-home construction lags recovery in economy, real estate

Print
Font Size:
Default font size
Larger font size

Related Stories

Posted: Wednesday, September 18, 2013 8:45 am

Home prices are on the rise in the Valley, but new single-family homes aren’t very plentiful because of the time it takes home builders to get land ready for construction.

The region currently has 208 subdivisions with more than 10 available plots, according to CRA, a Scottsdale-based real estate brokerage firm. By comparison, the area had 710 similar subdivisions in 2007.

CRA’s research focused on the average homebuilder “churning and burning” through inventory and excluded age-restricted communities, condominiums and homes built entirely to customers’ preferences, said Todd Vesledahl, vice president of sales.

“It’s really, really interesting to watch how this market’s going to unfold,” Vesledahl said.

The low inventory reflects the new home industry’s pessimism of a few years ago, said Michael Orr, director of the Real Estate Center at Arizona State University’s W.P. Carey School of Business.

From the purchase of the land to the construction of a house, Valley homebuilders face an 18-month lag because of issues like permits and impact fees, Orr said.

The housing market is moving back to normal, Orr said. Other outliers, like high levels of investors and Canadians in the market, are also trending back to regular levels, he said.

“I think that most of what you’re seeing is gradually getting a little bit more back to normal,” Orr said, “but the one thing that takes the longest to go back to normal is the supply of new homes.”

The region has a small amount of available new homes, but homebuilders are also hesitant to get caught with surplus inventory if the market were to collapse, said Ken Peterson, vice president of sales at Shea Homes.

“We’re just being more strategic,” he said.

The Phoenix area is still attractive to homebuilders, Peterson said.

“It’s not like we’re scared,” he said. “We’re very confident in the market.”

Orr said that the lack of new homes is a national issue.

About 1.5 million homes were built annually since World War II; however, the new home market has experienced a deficit in recent years, he said.

The country will eventually experience an above-average number of new homes in the market, Orr said.

“My feeling is that eventually we’ll go back to building more than 1.5 million units in order to compensate for that deficit,” he said. “Nobody knows quite how fast it’ll happen though.”

The new home industry should target about 500 active subdivisions, Vesledahl said. That goal could be reached in three to five years if interest rates remain low and no global crises emerge, he said.

Vesledahl also said 157 new subdivisions will enter the marketplace in a year.

However, 83 current developments will fall out of CRA’s research parameters if each one make three sales a month.

At that rate, the area will have 282 subdivisions in a year, a number that is still low, Vesledahl said.

More about

  • Discuss

Cartel Coffee Is Giving Away Free Coffee On Thursday, September 29

Teresa Traverse A A No, that headline is not too good to be true: On Thursday, September 29, Cartel will be giving away your choice of one fre…

Published: September 26, 2016 - 7:42 pm @ http://www.phoenixnewtimes.com/restaurants/cartel-…

Driving your own car could one day be a socially unacceptable public health risk

In 2014, over 32,000 people were killed in car crashes in the U.S. In 2012, more than two million Americans visited the emergency room as a re…

Published: September 26, 2016 - 7:12 pm @ http://www.businessinsider.com/driving-your-own-ca…

Not Your Father's GOP: The Deficit Debate Has Disappeared

Donald Trump says eliminating burdensome regulations is the key to spurring economic growth. (Bill Clark/CQ Roll Call File Photo) (First appea…

Published: September 26, 2016 - 7:05 pm @ http://www.rollcall.com/news/politics/gop-deficit-…

‘Erin Brockovich’ Carcinogen Found in the Drinking Water of More than 75% of Americans

Unsafe levels of a cancer-causing chemical called chromium-6 are contaminating the tap water of more than 200 million Americans in all 50 stat…

Published: September 26, 2016 - 7:00 pm @ https://foodrevolution.org/blog/food-and-health/ch…

Standing Rock Stakes Claim for Sovereignty

Mainstream media would have most of us believe that the current struggle at Standing Rock, North Dakota is all about clean water – that its on…

Published: September 26, 2016 - 6:38 pm @ http://dissidentvoice.org/2016/09/standing-rock-st…

Monday Geology Picture: Travertine Timeline

This week I’m featuring one of my all-time favorite geology pictures: a snapshot of layers of travertine, representing the build-up of carbona…

Published: September 26, 2016 - 5:33 pm @ http://blogs.agu.org/georneys/2016/09/26/monday-ge…

Political battleground states see highest rise in property values

Monday night will see the first presidential debate between Republican candidate Donald Trump and Democratic candidate Hillary Clinton. With t…

Published: September 26, 2016 - 5:07 pm @ http://www.housingwire.com/articles/38123-politica…

Police: Driver hit while making left turn killed in Phoenix crash

PHOENIX - Police are investigating after one person died in a crash Monday afternoon. Authorities say a man was driving south on 35th Avenue a…

Published: September 26, 2016 - 5:07 pm @ http://www.abc15.com/news/region-phoenix-metro/nor…

Why Does Trump Like Dictators?

And would he support democratic movements abroad as president? Donald Trump likes dictators and likes to be liked by them. After meeting Egypt…

Published: September 26, 2016 - 5:03 pm @ http://www.weeklystandard.com/why-does-trump-like-…

FACT CHECK: Donald Trump is right, the immigrant population is set to break records

Donald Trump has made immigration a focal point of his presidential campaign from proposing to build a wall  to curb illegal immigration to re…

Published: September 26, 2016 - 4:33 pm @ http://www.abc15.com/news/national/fact-check-dona…

Facebook

ahwatukee.com on Facebook

Twitter

ahwatukee.com on Twitter

RSS

Subscribe to ahwatukee.com via RSS

RSS Feeds

Spacer4px

Most Popular

Online poll

Loading…