Plan specific homebuilders have been working hard in recent months to keep up with demand for new housing. Not only do a majority of home buyers prefer a brand new residence, but across the country housing supply is extremely low. The homebuilding market isn’t always as lucrative and positive as it might be right now, however, and supply and demand are hardly the only factors that contribute to a successful housing market.
You already learned about the importance of market lending rates and the need for actual open land in part one. Now it’s time to take a deeper look into the plan specific homebuilder industry and what leads to a successful market.
Here are the final two of the four major factors that contribute to a successful homebuilding market.
The market just can’t sustain itself if there aren’t enough buyers. There can be all the land in the world to build new homes, but if buyers aren’t interested, those properties will just sit there, stagnant. That was one of the many reasons the 2008 housing crisis was such a disaster for the national economy, as it became incredibly difficult to sell new and old homes alike. A major aspect of buyer interest is the individual buyer’s financial situation, which is why the housing market’s health tracks closely with the economy writ large. For example, only 10% of first-time or repeat buyers will purchase homes priced at $500,000 and above. If all the new homes are listed near that price, the market won’t be able to sustain itself, and there will be plenty of housing issues.
Additionally, homebuyer interest isn’t confined to simply wanting to move into a property or not. There are many factors that contribute to whether or not a potential buyer wants to even pursue a new home purchase or not. These reasons include the overall home building process timeline, the time of the season they are planning on moving, the city or region they are thinking about moving to, and all the other financial aspects (in addition to housing price) involved.
Experienced Home Builders
On the flip side of buyer interest, if there isn’t enough builder interest, the market won’t do all that well, either. Again, even if home buyers are itching to spend money on new home designs, if there aren’t enough homebuilders wiling to actually put in the work and construct the properties, the market will likely fall. There are a variety of reasons that new housing starts fail to match demand, but a failure to find skilled construction workers has been a major obstacle for many builders in recent years. For the market to succeed in all facets, plan specific homebuilders require skilled workers of the highest quality, not just inexperienced contractors with some tools.
Today, the residential housing market is doing well despite limited supply, but it’s still important to realize how fast the markets can change.
If you want to check out some home sites in Tampa that would be great for a new home, contact Inland Homes today.