….We Think Yes!
In our recent New Construction Update for Knoxville, TN, we noted that there is potential for an upcoming shift in the real estate market. There are also many questions surrounding this shift, but looking ahead to find answers is what will determine which Knoxville builders and developers will survive in this evolving market. The challenges ahead stem from low inventory (see graph below), climbing interest rates, affordability and other factors, all of which could hinder buyers from being able to purchase a home.
Fortunately, there is hope on the horizon. As Inman points out, new construction may just save the day. Builder confidence is higher than ever, and in February, housing starts as well as new home sales were growing. This is a good sign, and could help alleviate the challenges of low-inventory real estate markets by giving buyers the option to buy a new home versus an existing one.
Some notable facts about new construction from Inman:
- New builds typically represent about 10 percent of the market, which is a relatively small portion
- The median price of a new home is higher than that of an existing home
- New home starts soared during the housing boom, but flattened over the past few years, and have not yet fully recovered.
- All around the country, questions of who should build, where they should build and what type of housing they should build has been discussed in neighborhood councils and has made it onto a few city ballots during recent elections.
- Rising costs of land, labor and materials may hurt new construction ventures, especially in lower price points where there is the most demand.
- The search for affordable housing is already pushing many potential buyers out of major metropolitan areas.
With buying season upon us, The Holli McCray Group is here to help builders and developers overcome the challenges stemming from low inventory and affordability. Our team has hundreds for home buyers looking for their perfect home, but have not yet found it. What better way to solve this problem that with the purchase of a brand new home from a trusted Knoxville builder endorsed by the Home Builders Association of Greater Knoxville (HBAGK). Based on all of the information we have seen recently, this is a fantastic time to be building new homes!
Learn more about our new construction strategic alliance program for builders and developers in the Knoxville area. Schedule a time to speak with our New Construction Specialist, Darryl Dardar, who has an impressive resume working with both builders and developers to effectively sell their properties.