The Triangle new home industry started 12 percent more homes in 2010 than in 2009, the first year over year increase since 2005, according to Metrostudy’s 4Q10 Residential Survey.
“Continued positive job growth, fundamental national, state and local economic improvement and sustainable inventory levels point to sustainable growth in the coming year without the help of tax credits,” says Ed Dunnavant, Senior Consultant Metrostudy Triangle Region.
While 2010 total new home starts of 5,841 were lower than the 16,426 recorded in 2005, the 12-percent increase is significant in that it is the first year over year increase since 2005. It is also 16 percent higher than the annualized low (sum of the past four quarters) of 5,036 recorded in 3Q09.
“With supply levels across most price points returning to equilibrium, the stage is set for greater production over the next year,” Dunnavant says.
During 4Q10, total inventory of homes in all stages of construction decreased to 4,410. The total inventory represented an 8.1-month supply, no change from the 8.1-month supply in 3Q10. The 2,643 units of finished vacant inventory was a slight increase from the 2,581 at the end of 3Q10.
“The slight increase in finished vacant supply should not be viewed negatively as builders must begin construction in late fall to provide available inventory for buyers looking for housing in the spring — typically the most active time of the year for buyer activity,” Dunnavant says.
Raleigh-Durham has not experienced the large levels of excessive inventory and foreclosures that have plagued many headline markets over the past several years. These markets now even appear to be exhibiting signs of stability.
Because many of these markets are major feeder markets for the Triangle positive headlines in these markets will have a positive impact on sales and consumer confidence in the Triangle, Dunnavant says.
The Triangle has been gaining jobs over the last several months, while lowering the local unemployment level.
“Markets where job growth is evident will be where demand for housing is strongest in 2011, thus, the Triangle will remain among the top new home markets in the country as positive job growth is expected by all local experts,” Dunnavant says.
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70 percent of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.Share