2013 is on track to continue positive growth.
The upcoming year of 2013 is on track to continue the positive growth of this past year. More banks are opting to work with their customers to modify their home loans. Some lenders are even offering cooperative short sales to distressed homeowners complete with relocation assistance in the form of a check. For a while there it seemed like you couldn’t turn a corner without seeing a notice of foreclosure in a window, or a boarded up house. Now banks are more willing to work with customers to modify or short sell homes, resulting in fewer foreclosures. A few years back, builders simply couldn’t construct a home for what foreclosures were selling for. Now that the oversupply of real estate owned properties (REOs) is no longer there to clog up the market, more and more buyers are turning to new construction.
So many buyers are choosing new homes, housing starts are up 47 percent over last year, and permits are up 30 percent, making September and October the best months for new home starts since 2008 according to CNN Money. Certainly these are positive markers, but will this trend continue? Yes, says the National Association of Realtors. In fact, new home sales are expected to increase from 368,000 in 2012 all the way to a projected 575,000 in 2013.
So what’s the rush to buy new? The obvious reasons are the ability to select your finishes and design details, as well as being a part of the building process from the ground up. Another reason is the lack of inventory elsewhere in the market. Orlando currently has a three-month supply of inventory, meaning there are 8,094 homes for sale, down 18 percent from this time in 2011. Less resale homes to choose from combined with continued growth in the demand for housing, especially in destination markets such as Central Florida, have created a window of opportunity and builders are seizing the day.
Mike Roche, Orlando resident and Vice President of Sales and Marketing for Ashton Woods Homes, shares this success story; “Ashton Woods opened our Lake Reams community in the Windermere area for pre-sales in April 2012 with 82 lots. We sold our last home there in November, with prices appreciating $20k during this time. The Orlando Market is back, healthy and primed for growth.”
Lawrence Yun, chief economist for the National Association of Realtors, promises real estate values will rise 15 percent over the next three years meaning fewer upside down home owners. Yun goes on to say the increasing demand for homes may even cause shortages and more rapid price gains. With demand projected to continue, new home construction—as well as the housing market overall—can expect to see more silver linings just like this.
Christina Rordam is a local Realtor. Contact her at 407-928-8294 or ChristinaSellsOrlando.com