On July 26th the DEMAND SIDE data is scheduled to be released on Unit sales, Price, and Months of Inventory. While new home sales are up to 850,000, the volume being built is nowhere near the 1.2 million that was being built in 2007. Since real estate is subject to supply and demand, when the demand for housing is high, but the supply is low, home prices often rise. For the past 10 years, there has been a cumulative undersupply of new homes being built. Many mid-sized builders went bankrupt following the 2008 crash.
Below are NEW home DEMAND SIDE info – New Updates on July 26th
Building Permits
Privately‐owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,685,000. This is 0.6 percent below the revised May rate of 1,695,000, but is 1.4 percent above the June 2021 rate of 1,661,000.
Single‐family authorizations in June were at a rate of 967,000; this is 8.0 percent below the revised May figure of 1,051,000.
Below is Single Family Permits (green line)
Traditionally, owning a home is a measure of many people’s overall financial health. The pandemic brought the need for owning a home to the forefront with people working and educating their kids from home. Although the housing market has cooled slightly, homes are still in high demand.
Bill Knudson – Research Analyst for Landco ARESC