Why are New Homes in Such Demand?
Have you noticed more people you know buying new homes in the last year or so? Well, it’s not just you. With the world beginning to recover from the COVID-19 pandemic, the housing industry is still feeling its effects as demand for new homes hits the highest levels since prior to the Great Recession.
Here are some of the biggest reasons why
One main reason is due to the low supply of existing homes on the market. At the current sales rate, the unsold inventory remained at a 2.0-month supply, which is down from a 3.1-month just a year ago. Existing homes stayed on the market for an average of just 20 days, and most homes were on the market for less than one month.
You’ve also probably at least heard of the rising lumber prices that have been in effect for a while now. Significant increases in material costs, coupled with a shortage of labor and land gets us to where we are today. The supply of housing is struggling to meet the increased level of demand. Additionally, historically low interest rates have provided these buyers with extra purchasing power.
The benefits of a new home are clear. Buying or building new provides your family the opportunity to have the right space for the way you live. It also gives you more certainty on your expenses with considerably less home maintenance costs compared to an existing home. Lastly, a high performance home offers lasting value and saves you money on utilities throughout the life of the home.
Setting The Right Expectations
At Tim O’Brien Homes, we strive to provide transparency and certainty into your already overwhelming new home search. All homebuilders across the country, including Tim O’Brien Homes, are facing limited land availability, labor shortages, rising material costs, all of which are causing delays in build times and driving costs up.
Now is still a GREAT time to build or buy a new home, but it might take longer and will cost more than one year ago. Before you start your search, make sure to have your financing in order as soon as possible. You’ll also want to start thinking through all aspects of what you want (location, floor plan, design elements, etc.) so that when the opportunity presents itself, you’re able to quickly secure your dream home!