Although 55 percent of self-labeled “buyers” would like a new home, only eight percent of that population actually makes it all the way to closing on a brand-new building. Those new, low numbers come from the Census Bureau and the National Association of Home Builders (NAHB) after evaluating data provided by the 6.8 million households that made home purchases in 2010 and 2011. According to the data, although more than half of all buyers would like a pristine, never-lived-in home of their own, the majority were deterred by the price of new construction and an aversion to living too close to construction. New homes sold for a median market price of $230,000, and for many buyers the $60,000-plus in savings that could be garnered by purchasing an existing home were too good to pass up. Buyers also cited problems finding new construction in close proximity to their work locations since many new homes are located in “far-flung suburbs,” as one reporter put it.
Numbers like these may be behind the declining trend in homebuilder confidence these days, but builders still are forecasting sales volumes over the next six months that will be better than any since 2007. Homebuilder confidence measured at 42 in April 2013 – the lowest since October 2012 – but expectations remain high, albeit for smaller profit margins. Do you think that new-home construction is finally on the rebound? Should builders be feeling better about new-home sales?
Your comments and questions are welcomed below.
by Carole VanSickle