During times when the housing market has more buyers than homes for sale, the quickest remedy is to build more homes. Adding inventory to the market gives buyers more options, helps balance supply and demand, and keeps home prices in check. Essentially, new home construction plays a vital role in housing market health and affordability conditions.
According to recent news, home construction is up. The U.S. Census Bureau and the Department of Housing and Urban Development show a 3.6 percent increase in the number of new homes that began construction in 2018. The year-over-year improvement put the number of completed new homes last year at nearly 1.2 million. Unfortunately, toward the end of the year, stock market volatility slowed the pace of new home construction.
However, with buying conditions becoming more favorable and builder confidence on the rise, there is reason to believe new construction of single-family homes will begin to climb again this spring. That’s encouraging, not just for buyers interested in newly built homes, but for all potential home buyers.