Eye On Housing
Author Archives
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New Homes Same Size but Higher Priced if Age-Restricted
Of the roughly 1,005,000 single-family and 547,000 multifamily homes started in 2022, 59,000 (28,000 single-family and 31,000 multifamily) were built in age-restricted communities, according to NAHB tabulation of data from the Survey of Construction (SOC, conducted by the U.S. Census Bureau and partially funded by HUD). A residential community can be legally age-restricted, provided it conforms the one of the… Read More ›
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AD&C Loans: Rising Rate & Tightening Trends Continue
Interest rates on loans for Acquisition, Development & Construction (AD&C) continued to climb in the second quarter of 2023, according to NAHB’s quarterly Survey on AD&C Financing. Quarter-over-quarter, the contract interest rate increased on all four categories of loans tracked in the AD&C Survey: from 8.50% to 8.62% on loans for land acquisition, from 8.19% to 8.70% on loans for… Read More ›
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Bank Failures Having Some Effect on Builders
The failure of several banks in 2023 and the ensuing stress in U.S. financial markets have had an effect that some builders and developers are beginning to notice, according to two recent NAHB surveys. In one of the surveys, roughly three-in-five builders and developers reported that loans for land acquisition, land development and speculative single-family construction have become more difficult… Read More ›
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For Builders, Lot Shortage Eases But is Still a Problem
Obtaining lots to build on remains a challenge for many of NAHB’s builders, although the shortages are not quite as widespread as they were in 2021. Responding to special questions on the May 2023 survey for the NAHB/Wells Fargo Housing Market Index (HMI), 42 percent of single-family builders characterized the supply of lots simply as low, and another 25 percent said… Read More ›
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Rates on Development and Construction Loans Continue to Climb
While mortgage rates were stabilizing in the first quarter of 2023, rates on loans for Acquisition, Development & Construction (AD&C) continued to climb, according to NAHB’s quarterly Survey on AD&C Financing. From the last quarter of 2022 to the first quarter of 2023, the average effective rate (based on rate of return to the lender over the assumed life of… Read More ›
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Credit for Builders Tightens as Rates Climb
During the fourth quarter of 2022, credit continued to become less available and generally more costly on loans for Acquisition, Development & Construction (AD&C) according to NAHB’s Survey on AD&C Financing. To analyze credit availability, responses from the NAHB survey are used to construct a net easing index, similar to the net easing index based on the Federal Reserve’s survey… Read More ›
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Material Shortages Ease, With Notable Exceptions
In May of last year, Eye on Housing reported on historically widespread shortages of building materials. Since then, most of the shortages have eased; the major exceptions being shortages of HVAC equipment and certain categories of ceramic materials (ceramic tiles, clay bricks and cement-based building materials), which have gotten slightly worse. NAHB has been tracking shortages of building materials and… Read More ›
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Nine Percent of New Homes Are Teardowns
In 2021, 9.1 percent of new single-family homes were built in an older neighborhood on a site where a previous structure had to be torn down and rebuilt, according to the latest Builder Practices Survey (BPS) conducted by Home Innovation Research Labs. Another 18.5 percent were built on an infill lot in an older neighborhood. The BPS places new homes… Read More ›
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Builders Are Cutting Prices & Offering Incentives, But It’s Not 2008
In November of 2022, 36 percent of single-family home builders reported reducing their prices, and 59 percent were offering special sales incentives. These percentages may seem relatively high—and in fact they have increased significantly since July of this year—but they are nowhere near as high as they were during the 2007-2008 financial crisis. Questions on sales incentives have been a… Read More ›
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Credit Conditions for Builders and Developers Continue to Worsen
During the third quarter of 2022, credit continued to become less available and generally more costly on loans for Acquisition, Development & Construction (AD&C) according to NAHB’s Survey on AD&C Financing. To analyze credit availability, responses from the NAHB survey are used to construct a net easing index, similar to the net easing index based on the Federal Reserve’s survey… Read More ›