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Blogs Karen's Blog Arizona Home Builders Buying Up Land - Is It a Sign?

Posted Jun 16, 2010 10:30 am (10 years ago)

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A recent Arizona Republic story by Catherine Reagor cited an upswing in home building from April 2009 with 789 new home sales to April 2010 with 823 new home sales.  That is moving in the right direction, but still a ways behind the number of new home sales in Appril 2005, at the peak of Arizona home building, which totaled 4,800.  Wow!  How times have changed.

Renewal Zone real estate renewal classes for new home salesHowever, the first step in bringing new homes to the marketplace is, of course, acquiring the land to build them on, and that is happening in a frenzy across the Valley of the Sun.  According to Land Advisors brokerage firm, Arizona home builders have spend a whopping $90 Million so far this year in residential land transactions.  Prices are climbing as the supply of finished lots is being depleted and the bargains are disappearing, perhaps forever.

There other signs of recovery.  According to the National Association of Home Builders, builder confidence is now at its highes since Ausust 2007.  Housing analyst, R.L. Brown forecasts 8,500 new homes to be build in the Phoenix metropolitan area in 2010, and that would be an increase of 500 homes over the 8,000 built in 2009.  His latest forecast indicates 22,000 new home permits in 2012!

Everyone is interested in the new home sales market, because it impacts our economy with jobs and injects badly needed dollars into local business involved in construction, home improvement, furniture, etc. 

We know that there are still thousands of foreclosures and short sales in our market.  Those are the subjects of many of the real estate renewal classes at real estate schools across the country.  The inventory of resale homes will continue to affect the new home sales market over the next few years, but it is good to see, at last, some positive signs of recovery.