The numbers: Home-building activity has staged a significant turnaround from the coronavirus-related slowdown.
U.S. home builders began construction on homes at a seasonally-adjusted annual rate of 1.496 million in July, up 22.6% from the previous month and 23.4% from a year ago, the U.S. Census Bureau reported Tuesday. The pace of home building is now 7% down from the pre-coronavirus high.
Permitting activity occurred at a seasonally-adjusted annual rate of 1.495 million, up 18.8% from June and 9.4% from July 2019.
It’s wild here as we are clearly in a “boom.” Sadly, land prices are just beginning to move up, primarily because the market is being driven by California and other big city refugees looking for immediate housing. Still, there are encouraging signs: same day land sales (we haven’t seen that for a long time,) multiple offers, and shrinking inventories are all contributing to somewhat more solid prices.
The lack of ready infrastructure is holding many folks back. Some would be more than willing to live temporarily in an RV, but just don’t want to start completely from scratch. Having a septic, or even a basic driveway are all helpful. A well or utility power are hot sellers these days.
Meanwhile, it’s just startling to see how active the market is in the residential world. At least 50% of sales in Kingman are on the very first day of the listing. – Ben