How does building more new construction homes help our resale market?
“The sky is falling, the sky is falling!” I’m sure you know the story of Chicken Little. In 2022, it may sound more like, “Another 2008 is coming, another 2008 is coming!”
Luckily, I have excellent news for you. Our real estate market is not like it was in 2008, and the sky is perfectly fine. Our market is doing wonderfully.
Across the U.S., we look at several indicators to determine how the market is doing, and one of those is new construction sales. Historically across America, we need about one million homes built each year to keep up with the current population’s demand. In 2008, new home construction dwindled to a crawl, and they couldn’t keep up with demand. That’s why today it still feels like we don’t have enough houses.
“Our market is doing wonderfully.”
However, we caught back up with the trend line in 2021, so this year, we’re at a 15-year high for new home construction. That’s great news for both buyers and sellers, even if you’re not building a new house. Now all the people that had to buy resale have the option to choose a new build; with all the appreciation happening, they have enough equity to build. Then, as they’re building a new home, their current home will soon become one that others can purchase. As new construction sales increase, it opens up more resale inventory. That eases some of the pressure and demand we’re seeing in our market.
If you’ve been considering a move or have any questions, don’t hesitate to reach out to us via phone or email. We’d love to be your real estate resource.