Many buyers are wondering where to find houses for sale in today’s market. It’s a true dilemma. We see an increase in buyer demand, but the supply available for purchase isn’t keeping up.
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When homebuyers begin their research, they want to see all their available options! In many cases, they will include both new construction and existing homes in their search; but is a new construction home really the house of their dreams?
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The lack of existing inventory for sale has forced many homebuyers to begin looking at new construction. When you buy a newly constructed home instead of an existing home, there are many extra steps that must take place.
According to the latest New Residential Sales Report from the Census Bureau, new construction sales in August were up 3.5% from July and 12.7% from last year! This marks the second consecutive month with double-digit year-over-year growth (12.8% in July).
The Joint Center of Housing Studies (JCHS) at Harvard University recently released their 2017 State of the Nation’s Housing Study, and a recent blog from JCHS revealed some of the more surprising aspects of the study.
Many real estate economists have called on new home builders to ramp up production to help relieve the shortage of inventory of homes for sale throughout the United States. The added inventory would no doubt aid buyers in their search to secure their dream home, while also helping to ease price increases throughout the country.
The biggest challenge to today’s housing market is the shortage of housing inventory for sale. A normal market would see a six-month supply of homes for sale. Currently, that number is below four months. This is the major reason home prices have continued to appreciate at higher levels than historic averages.
In many areas of the country, there are not enough homes for sale to satisfy the number of buyers looking to purchase their dream homes. Experts have long proposed that a ramp-up in new, single-family home construction would be one of the many ways to overcome this inventory shortage.
The number of new home sales is far off historic norms. The National Association of Realtors (NAR) just reported that the percentage of all house sales that were newly constructed homes has fallen to the lowest numbers in forty years.
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