Home buyers are taking advantage of the availability of new homes because the inventory of new homes for sale
on the market has decreased to a 4.7 month’s supply – a total of
243,000 new homes for sale with only 56,000 completed, move-in ready
homes available. Demand will require that builders increase their
production of new homes for sale in order to keep up with the buyers.Single-Family Home Builders
April’s sales numbers go hand-in-hand with the reported new,
single-family home starts which increased by 3.3% at the beginning of
April. Builder confidence held steady for the 4th month in a row since
February, 2016, which contributed to new construction starts and
inventory on the ground. Single-family home permits in the beginning of
April were already up year-over-year by 8.4%, so construction of new
homes should continue to escalate over the next few months.While first-time home buyers are finding it difficult to find new homes for sale in their price range, the sales of homes priced from $150,000 – $200,000 increased to 10,000 sales in April. For existing home sales, the first-time home buyer sales accounted for 32% of these sales, opening up the market, once again for homes priced affordably.
Good News for Resale Market
Existing home sale closings increased by 6% year-over-year and by 1.7% compared to March’s sales. It is definitely a seller’s market right now as existing home inventory also stands at a 4.7 month supply like single-family new homes.The 2nd quarter of 2016 shows good news for the housing market after a slow 1st quarter start. New, single-family home starts and permits indicate an increase in new home inventory moving forward in the 3rd quarter. Sellers should be able to “take their pick” of home buyers as supply currently is lagging behind demand.
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