29 Aug Can We Stop Holding Our Breath About Housing?
For almost a decade now, any conversation surrounding the Housing Market has always held an edge of trepidation, even skepticism. And, while the last few years have seen positive activity within the industry, many professionals have a sort of ‘once burned, twice shy’ outlook on the housing market following the Great Recession. But, as we continue to see growth and improvement, here are a few reasons why it may finally be time for all of us to take a deep breath and look on the housing market with a slightly more positive outlook.
Generally when we’re talking about recovery and growth, we like to see everything trending upwards. But, July saw the median sale price for new homes take a dip from $310,500 in June to $294,600. The kneejerk reaction to this news may not be to celebrate, but it’s actually a good indicator. 2016 has highly favored sellers, and the growth in home prices has left new homebuyers who are looking to enter the market struggling to find an affordable starter home. This dip in new home sale price shows that builders are paying attention to buyer demand, and are providing more affordable options.
Millennials are Finally Taking The Leap
In the early years of the recovery, one of the most concerning factors in the housing industry was the millennial buyer – or the lack thereof. Up until 2015, it seemed millennials were more interested in renting a home than buying one. However, as the oldest members of this generation enter their 30s, they’re finally beginning to take the plunge and buy a new home. As this large generation continues to ‘grow up’, and more and more members purchase homes, we’re seeing some of the uncertainty about millennials’ impact on housing begin to wane.
Home Starts are More Than Double What They Were in 2009
At the lowest point of the recession – 2009 – New Home Starts had fallen below 500,000. Today they stand at 1.2 Million. And, this more-than-a-million trend has continued for the past few months, indicating not only a positive outlook on the market, but the demand to support that outlook.
There are Enough Jobs to Go Around
Leading up to the housing crisis, the ratio of predicted new jobs to new homes was 1.1:1.0, which doesn’t leave much wiggle room should a homebuyer need to seek a new job. Now, however, the ratio is estimated at 2.4:1.0. These are much more favorable numbers, which provide for a much steadier base of homebuyers, ready to buy new inventory.
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