On Q’s In-House Expertise: 2017 Housing Forecast

housing forecast

Housing Forecast, 2017

What’s the Basic Summary?

∙ January ‘Housing Starts’ (When a house starts being built) is Up 10.5% from January 2016

∙ Combined Permit Issuance Up 4.6% from January 2016

∙ Homebuilding Professionals are Optimistic

Homebuilding Activity

The U.S. economy is complex and difficult to predict.  Since the economic crisis of 2007 homebuilding activity has been a leader in the recovery as the primary driver of economic growth.  Recent indicators show homebuilders feeling optimistic and confident about the future.

On Q Financial, Inc., VP-Builder Development, Donna Timmerman, has years of experience and industry knowledge in working with homebuilders.  She has offered her thoughts regarding the homebuilding industry.

Homebuilding Construction Outlook

“It’s good to see homebuilders having a more positive outlook on future projects” Donna noted when asked about homebuilding. “There are several challenges to overcome, but we can expect at least some growth throughout 2017.”

Asked for details about those challenges, Donna continued, “Shortage of skilled labor continues to be a problem, due to many individuals that were forced to move to another state or another occupation to provide for their family.”

Continuing, Donna said: “Land prices in many areas have gotten more expensive due to shortage of suitable lots, which drives up builders’ cost.  However due to low inventory, the demand may apply upward pressure on pricing, which will help builders remain competitive and profitable.

Offering a broad look at the overall scene in her conclusion, Donna went on to posit that, “… a new administration, consumer confidence, job growth and other factors have created greater housing demand. Expect homebuilders to meet this demand by contributing to the supply wherever they can.” This is to say, there will likely be plenty of jobs related to homebuilding to go around, provided demand remains high.

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Building a Home in 2017

Housing Market Trends and Construction Forecasts

home building

Home Building

Home building can be changed due to external economic factors. These can directly effect and shape its success. Inflation, unemployment numbers, interest rates, social or political changes alter the homebuilding business. These external factors keep homebuilders cautious about  their business prospects.

Hope for 2017 Homebuilding Industry

A few reliable signs suggest a strong year for home building.

First, inventory is limited in several markets. Second, home demand has risen. Third, new home construction has been steady. To meet that demand, homebuilders are preparing to increase their production rate. Across the country’s one-hundred major metropolitan areas, “…homes available for sale is currently down an average of 11% year over…” Homes in those areas are getting snatched up 14% faster. The housing supply cannot handle this hungry market.

Rent to Own

Investing is a motivating factor for first-time homebuyers. Jonathan Smoke, Chief Economist with Realtor.com, has publicly stated, “…people are focused on getting into homeownership because renting…over the long term, is something that can really impact a household’s financial situation.” Americans are responding wisely to what Realtor.com describes as “…a damper on price appreciation…” This is a response which could see large parts of the housing market bought by first-time buyers. If that ends up playing out, the demand for new housing units may increase.

Credit rating agency Moody’s has a telling prediction. Their experts say, “…revenues in the homebuilding industry to rise at an annual rate of more than 10% for the next 12 to 18 months.” Also is this related forecast, “Operating income in the building materials sector is also expected to grow by more than 7% during [the next 12 to 18 months].”

Many connected factors suggest growth within the home building industry. Less houses being available and buyer optimism set the stage for a more home construction. The end result could be beneficial for those looking to enter the housing market.

Contact an On Q Financial, Inc. mortgage consultant for insights and advice regarding this fast changing market.

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For Second Month, Every State has at least One Improving Market

After a long, exhausting wait, conditions in the housing market  are improving across the nation. Per Mortgage News Daily, every state across the U.S. has at least one metro city with an improving housing market  for the second consecutive month. This is great news for many homeowners who chose to ride out the housing bubble. Rising home prices will allow many were previously underwater or with little to no equity to list sell their home.

Also, the housing recovery is contributing to the overall health of the US economy. Every home purchase and new build aids in creating jobs and lifting local tax revenues.

If you’re ready to jump back into the housing market, give On Q Financial, Inc. a call. One of our expert Mortgage Consultants would be happy to meet with you and review your mortgage goals.

New Housing Construction Reaches 4 Year High

Last month, U.S. builders unleashed a flurry of new construction on single-family homes and apartments. This has been the fastest rate of new construction since July 2008.  New Housing starts rose 15% in September alone. This provides further evidence that a broad base housing recovery is gaining momentum.

Although new homes represent just a small piece of the housing market, according to Yahoo Finance, “…they have an outsize impact on the economy.”  For every new home built, it is estimated that an average of three jobs are created and approximately $90,000 in tax revenue.

On Q Financial, Inc. can help you get started in your home search, whether new construction or an existing home, by helping you determine how much house you can comfortably afford. Consider working with one our expert Mortgage Consultants to get pre-qualified today.