Boots-on-the-Ground Observations by 21 Home Builders about the Housing Market They’re Facing
#Phoenix builder: “The positive is there’s light at the end of the tunnel for improving build cycle times. The negative is there won’t be customers on the other side of said tunnel.”
We’ve seen the data from the Census Bureau about the downturn in the market for new houses: surging inventories – 11 months’ supply in July, highest since the worst days of Housing Bust 1 – exploding construction costs that home builders are facing, though some of those cost spikes are now abating; and plunging sales (-30% across the US, -50% in the West). The National Association of Home Builders reported dismal traffic of prospective buyers. And we’ve seen how home builders reacted: construction starts of single-family houses plunged 18% year-over-year, though construction starts of multi-family buildings jumped.
So here are the home builders themselves, in their own words. John Burns Real Estate Consulting’s Home Builder Survey summarizes feedback from over 300 home builders in over 80 metro areas. The survey results are limited to paying clients. But Rick Palacios Jr., Director of Research at John Burns, when he noted today that the August results were in, posted in his Twitter account some quotes from 21 home builders. These are boots-on-the-ground thoughts and observations from those in the thick of it.
The “top themes” in the August survey, Palacios said, were:
- Home price cuts along with other incentives are helping sales (for now).
- Supply chain is healing as demand drops and builders quickly slow housing starts.
*****
Continue reading this article at Wolf Street.
