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Will New Home Building Help Inventory Shortages in Real Estate Markets?

Will New Home Building Help Inventory Shortages in Real Estate Markets?

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By Elaine VonCannon, ABR, SRES, Associate Broker, Notary, Team Leader, Property Manager, Award Winning Agent

What are homebuyers searching for in today’s real estate market? There are many characteristics of a home – and a neighborhood – that appeal to the current buyer. Many people in the professional job market are experiencing a greater flexibility with personal mobility. They are able to work from home or relocate to a desirable place where employment opportunities are numerous.

Many buyers prefer new homes to existing homes when making a purchase, for a variety of reasons. A new home is not likely to need immediate maintenance. It may even come with a one year home warranty – making the first time homebuyer feel secure in the initial year of purchase.

Housing Market Uptick

With personal mobility on the rise, there are also more female homebuyers (20% of the present real estate market) and the potential for household formation is greater than it was during the recession. Housing priorities that are looked at closely by the buyer have shifted slightly with the times. Homebuyers in today’s market want: shopping, restaurants and entertainment nearby, economic growth, public parks and walking/biking paths, walkability and more.

Low Housing Inventory in Some Markets May be Only Temporary

Since the recession, there are low inventories of saleable properties in many different U.S. markets. Check with the National Association of Realtors (NAR) and state real estate organizations to find the current inventories in your area. The NAR reported on May 22, 2014, "Total housing inventory at the end of April jumped 16.8 percent to 2.29 million existing homes available for sale, which represents a 5.9-month supply at the current sales pace, up from 5.1 months in March." This is a sign that inventories are improving overall.

Renovation Loans and Construction to Perm Loans Available Now

Many banks and mortgage companies now offer renovation loans. These loans are designed to encourage homebuyers and real estate investors to purchase bank owned properties and foreclosures, which generally need maintenance and upgrades upon acquisition. To build new homes to specifications, construction to perm loans are now available. All of this bodes well for low housing inventories in various markets.

New Home Builders, Williamsburg and James City County, Virginia

New home builders in the real estate market today are striving to create communities based on chosen lifestyles. For example, in my region, the Williamsburg, Virginia real estate market, excellent community planning has helped James City County grow in leaps and bounds. There are numerous 55+ communities, golf communities, and gated communities with families and children, and a well-respected education system.

In James City County, new homes for sale include townhouses and condominiums situated near shopping areas and recreation. Many moving to the Williamsburg area are impressed with the plentiful green areas for public recreation and the mild, year round climate. Other enticements for growth include low real estate taxes, compared to taxes in Northeastern states, making a home purchase in Virginia appealing for retired homebuyers.

Major Employers in Williamsburg, VA

Economic opportunities in Williamsburg exceed years past thanks to new growth and strong, key players in the local economy. Employers include: Colonial Williamsburg, The College of William and Mary, Riverside Regional Health System, Sentara Hospital, The National Park Service and many more. In nearby West Point, Virginia, the RockTenn Company paper mill employs many in well-paying jobs.

In Williamsburg, Virginia, strategic community planning combined with economic growth has created desirable surroundings for many. The town is occupied by college students, young professionals, families with children and a significant number of retired people as well as Active Boomers. New home builders have risen to the occasion by adapting their vision to the town’s own future – with great success.

Some of the most well-known communities in the Williamsburg area are Fords Colony, Kingsmill and Stonehouse. These are excellent examples of golf communities that provide quiet, scenic surroundings in luxurious settings as well as numerous other amenities.

New Homes for Sale in Williamsburg, Virginia

Many of the builders currently working in Williamsburg are national production build companies such as Ryan Homes, creating a project in Upper York County named Washington Ridge. Lennar is working on Colonial Heritage in James City County, a 55+ community boasting an active lifestyle for residents. On site there are tennis courts, golf course, pool and a spa as well as other amenities. Then there are numerous communities where the home purchaser can have their dream home built on site, from the ground up.

Buyers Agent Needed for New Home Purchase

Many home buyers find this out the hard way, so be forewarned: do not rely on the builder to provide adequate representation when purchasing or building a new home. By law, a real estate buyer is entitled to a representative, so make sure to secure an agreement with a professional real estate agent. Remember, all of the representatives of the builder work for that particular company – not the buyer. The company representative may be trained to upsell home features and add more cost to the home purchase. A buyer’s agent will negotiate the best deal, at the average cost per square foot in that particular real estate market and is well worth the commission.

As the recession passes into memory and the economy continues to improve, more people will find secure employment and begin new endeavors. Many will want to purchase a home. Any individual, couple or family searching for a home wants to have choices. According to present indicators, low housing inventory will not be a challenge to the home buyer for long as new home building and home financing opportunities become available and popular with buyers. Learn more about new homes for sale in Williamsburg, Virginia. Visit http://www.voncannonrealestate.com.