Buyer Boost in New Homes
June is National Homeownership Month, with that in mind more and more Americans are now turning to newly built homes. Sales of newly built, single-family homes increased in April, reaching the highest level since March 2022. Limiting inventory on new homes has created a new need for newly constructed homes, along with increased interest rates on loans. With a higher demand for more homes buying or constructing newer ones is the current trend as sales of newly built, single-family homes increased in April, reaching the highest level since March 2022.
According to LMB Journal, Limited existing inventory has placed a renewed emphasis on new construction. In addition, new home construction is taking on an increased role in the marketplace because many home owners with loans well below current mortgage rates are electing to stay put. Current interest rates have more than doubled from 2021. As a result, the supply of existing homes is incredibly low. With limited available housing inventory, new construction will continue to be a significant part of prospective buyers’ searches in the quarters ahead. This housing environment is fueling cautious optimism among builders; however, they continue to face challenges in meeting the demand for new construction. Residential construction obstacles include shortages of distribution transformers, other building materials and tightening credit conditions for residential real estate development and construction brought on by the actions of the Federal Reserve to raise interest rates.
