Is There Relief In Sight To Low Inventory In The Housing Market?
If you’ve followed real estate at all over the last few months, then you know homes are flying off the market. As soon as they’re listed for sale, they go under contract before you know it. Is there an end in sight?
Why are there so few homes on the market and is there an end in sight? It’s true that inventory is low, buyers outweigh the number of homes on the market, so homes are going under contract almost as quickly as they're listed. There are a lot of components to the housing shortage: the pandemic, interest rates, rising rent costs, changing needs in a home, but today we’re going to take a look at new home construction and how it’s playing a part in today’s housing market. So let’s take a look at some of the historical trends in new home construction.
Think back to the early 2000s. Construction was everywhere. New homes were popping up all over Volusia County and the market was booming. Then came the housing crash and new construction came to a screeching halt. We had a number of foreclosures enter into the market and new community development was put on hold or even canceled all together. Fast forward a few years and we started to see the housing market begin returning to normal. And then… then the pandemic hit. So we were already behind in the construction of new homes for those years leading up to the pandemic, and now we’re seeing new challenges brought on by the Coronavirus. Labor shortages are making it difficult to find workers, which is causing supply issues for building materials. This is all a very simplified version of what’s going on in the housing market, but bottom line, new construction has slowed and buyers are feeling the impacts.
The good news is, here in Volusia County we’re going to see a significant increase in new construction in 2022. We saw a 33% increase in building permits for new homes in 2021, and we’re going to see a number of these projects get underway. Construction is already expected to begin on the first phase of Avalon Park Daytona Beach, which is a 10,000-home community planned just west of I-95 along the south side of State Road 40. And ICI Homes will continue building in Plantation Bay in North Volusia and South Flagler Counties, and also in both Woodhaven and Brown’s Landing in Port Orange.
Experts are also projecting more homes will soon become available thanks to sellers re-entering the market after taking a wait-and-see approach when the pandemic hit. We’ve already seen an uptick in new listings since the beginning of the year, which is great news for buyers who are feeling exhausted by the competition in today’s market. If you’re thinking about selling, now is the time. You want to get your home on the market before these new construction homes become your competition.