An Uptick in Home Building Construction Times During 2020

The 2020 Survey of Construction (SOC) revealed that it took 10 days less to finish a home from authorization to completion in 2020 than in 2019. The survey also shows that the average completion time of a single-family house is around 7.8 months, which usually includes a little over a month from authorization to start and another 6.8 months to finish the construction.  Good news for the housing market as inventory has been very low the past year.

Depending on the function of the new construction single-family homes the time it takes to complete varies. For a house built for sale, it took the shortest amount of time which was 6.9 months from permits to completion. A new construction home built by owners took around 13 months and a home built for rent took around 10.6 months. New construction homes built by a hired contractor only took 9.7 months from permits to completion.

Time also varies by region. The region with the longest time tied with Middle Atlantic and New England at 11.6 months while the shortest was the South Atlantic division with an average of 7.8 months. The remaining regions include the Pacific at 10 months and East South Central at 9.1 months.

Hopefully, with the shorter construction times, there will be more inventory for homebuyers. If you are in the market for a new home, choose a Realtor to help you with the process.

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Buyers’ Must-Haves When It Comes to Kitchen and Bath Features

The National Association of Home Builders' publication What Home Buyers Really Want, 2021 Edition, gave us the top features buyers want in a kitchen and a bathroom. In the kitchen, four out of every ten buyers feel that a double sink is essential and expressed they would probably not purchase a home without this feature. For bathrooms, most buyers said it was essential for a separate shower and tub in the primary bathroom.

The kitchen top 10 kitchen features that rated essential or desirable were a double sink (side-by-side) 81%, walk-in pantry 81%, table space for eating 78%, a central island 77%, drinking water filtration 76%, granite/natural stone countertops 73%, recessed lighting 69%, customized backsplash 69%, pull-out shelves 68% and a breakfast bar 64%.

Broken out by buyers who say it is essential and buyers who say a feature is desirable were surprising. For the top 10 features that were essential 42% of buyers said a double sink, 35% table space for eating, 34% chose a walk-in pantry, 32% said a central island, 32% drinking water filtration, 26% granite/natural stone countertops, 26% recessed lighting, 23% customized backsplash, 22% pull-out shelves and 19% breakfast bar.

Bathrooms are deemed very important to today's buyers, especially the primary bathroom. The top ten on the list for the home's primary bathroom were a linen closet 76%, both shower stall & tub 74%, double vanity 69%, private toilet compartment 67%, toilet, tub & sink-white 65%, granite vanity 65%, ceramic tile walls, multiple shower heads 59%, whirlpool tub 56% and body spray panel 56%.

Buyers who said that the bath shower stall & tub were essential ranked the highest at 36% while the linen closet ranked the highest in desirable at 49%. The lowest-ranked feature for both essential and desirable were dual toilets.

If you are in the market for a new home, now is the time to purchase one due to historically low interest rates. Remember to use a Realtor who can help you with the process from choosing a home to closing.

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Home Buyers Will Need Patience When Purchasing a Home in 2021

The current housing market is booming which is good news but is it for buyers? Homebuyers are facing many obstacles in this seller's market. In fact, it is one of the most competitive markets we have seen for homebuyers recently. According to the National Association of Realtors (NAR), homes that are for sale are getting around 4.8 offers per sale! This is due to the lack of inventory in the current housing market.

“The housing market is still relatively under-supplied, and buyers can’t buy what’s not for sale. Relative to what we saw in 2017 to 2019, March 2021 was still roughly 117,000 new listings lower, adding to the pre-existing early-year gap of more than 200,000 fresh listings that would typically have come to market in January or February. Despite this week’s gain from a year ago, we’re 19 percent below the new seller activity that we saw in the same week in 2019,” says Danielle Hale, Chief Economist at realtor.com.

Many are blaming the pandemic for lack of inventory because sellers are scared to have potential buyers in their homes but this is not the case. The main cause is the shortage of new construction of single-family homes. A chart which shows the completed single-family homes per decade shows a dramatic decrease from 2000-2009 to 2010-2019. From 2000 - 2009 12.6 million single-family homes were constructed and from 2010 - 2019 only 6.5 million single-family homes were constructed.

“Even before the COVID-19 pandemic and current recession, the housing market was facing a substantial supply shortage and that deficit has grown. In 2018, we estimated that there was a housing supply shortage of approximately 2.5 million units, meaning that the U.S. economy was about 2.5 million units below what was needed to match long-term demand. Using the same methodology, we estimate that the housing shortage increased to 3.8 million units by the end of 2020. A continued increase in a housing shortage is extremely unusual; typically in a recession, housing demand declines and supply rises, causing inventory to rise above the long-term trend,” says am Khater, Vice President and Chief Economist at Freddie Mac, Economic Housing and Research Division.

Freddie Mac estimates that close to four million homes will need to be built to meet the current demand. NAR reports that as of March 2021, there were 1.74 million housing starts which is the highest they have been in 14 years. This is an increase in both single-family and multifamily units. It will take around 4-8 months from start to completion on new construction so patience is needed.

If you are considering purchasing a home this year, you will definitely need some patience. A good idea is to contact your local real estate professional to help you navigate this demanding housing market.

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Motivations for Buyers To Move During the Current Housing Market

The current housing market is flooded with buyers with low-interest rates and slim inventory making it hard to compete. So what motivates these buyers to make the decision to move during the current market? Buyers across the country blame it on the health crisis. Your living space has become one of the most valuable assets during these uncertain times.

“For customers who cited COVID-19 as an influence on their move in 2020, the top reasons associated with COVID-19 were concerns for personal and family health and wellbeing (60%); desires to be closer to family (59%); 57% moved due to changes in employment status or work arrangement (including the ability to work remotely); and 53% desired a lifestyle change or improvement of quality of life,” according to the 2020 Annual National Movers Study.

These different perspectives have shaped homebuyers' new view on homeownership. Here are some reasons why buyers are considering now the time to buy.

1. Working from Home

This has become the norm in the working community. After the stay-at-home orders were mandated last year, the workforce had to change their perspective on working from home. Nowadays your work commute is not as important as it was in the past. There has been a residential migration because of remote working. Fifty-three percent expressed that they would be more likely to move.

2. Room for Fitness & Activities

Health has become more prevalent during the COVID-19 pandemic. This has become a top priority for all of us. Fitness Trends 2021: New Trends in Fitness [Global Report] states the fastest growing fitness training areas are at-home fitness equipment rising up 50%, personal trainers/nutritionists up 48% and online fitness courses, classes and subscriptions are up 17%. This means having a place at home for workouts is a must.

3. Outdoor Space

Now more than ever a place to enjoy nature is important when it comes to a home. Better Homes & Gardens released outdoor living trends which included that 60% of homeowners want an outdoor kitchen, edible gardens are also high on the list as well as secluded outdoor spaces.

Moving up to a bigger home might be your best option when it comes to accomodating any of these features. Now is the time to make the move with historically low mortgage rates. Take the plunge and choose a Realtor who knows your neighborhood and the current housing market.

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Stucco and Vinyl Make the Top List for Exteriors on New Construction Homes

The Census Bureau released their Survey of Construction (SOC) and data shows that the most used exterior finished in 2020 for a new single-family home was stucco. The report revealed that 28% of new homes started in 2020 the principal exterior material was stucco, 26% used vinyl, 21% used Hardiplank or Hardiboard, 19% brick of veer brick, wood products 4% and rock or stone materials only 1%.

The Survey of Construction (SOC) is a great resource distributed by the United States Census Bureau. The purpose of the survey is to gather the data on the current statistics for both national and regional starts, completions and characteristics of new construction on single-family and multifamily housing units. The report also includes sales of new single-family houses.

Along the different regions in the county, there were big differences in what was mainly used on the exteriors of homes in certain regions. Vinyl siding was used most in 5 out of the 9 census divisions. The report shows that in Middle Atlantic and New England vinyl was used as the primary exterior on 76% of new homes started in 2020, in the East 68%, West North Central 53%, and in East South Central 45%. Stucco won out in the Pacific division with 63%, Mountain came in with 50% and South Atlantic used the material on 39% of new single-family homes started in 2020. Brick or brick veneer was used the most in South Central with 64% and the East with 39%.

If you are in the market for a home, now is a great time to buy. The historically low-interest rates are in the buyer's favor. Remember if you are considering purchasing a home, use a licensed sales agent who can help you through the process.

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