Blog • Fun Facts • August 28, 2023

Where It’s At

by Rondi duPont

New Homes are where it’s at.

By ‘it,’ we mean inventory.

Given low supply of existing homes, home buyers have figured out that new homes offer an effective place to find homes for sale.

Here are the stats…

Inventory of existing homes is down 7.7% year over year. And, last year’s inventory was historically low.

Meanwhile, sales of new homes rose 4.4%. This increase was much more than most analysts expected.

New Homes are where it is at.

Blog • Fun Facts • July 14, 2023

New Opportunity

by Rondi duPont

One of the many opportunities for buyers today is new construction.

In Northern Colorado, just under 25% of all available homes for sale are brand new homes.

That percentage is roughly 50% more than normal.

Buyers who are looking for a greater selection can consider new homes.

New homes offer obvious advantages like trendy finishes and new appliances.

They also often offer attractive incentives like lower mortgage rates.

So, in a time when it feels like there is less to choose from, new homes are a great option.

Blog • Fun Facts • May 12, 2023

More New

by Rondi duPont

Nationally, new home inventory as a percentage of the total inventory just hit a record high. 26% of all properties currently available for sale are brand new homes.

To put this in perspective, in 2018 it was 14%. From 2000 to 2008 it bounced between 10% and 15%

Locally, we notice even higher numbers.

In Larimer County, 29% of all inventory is brand new. In Weld County, it is a whopping 35%.

The reason why the percentage is high is not so much because of a surge in new construction, but because the amount of re-sale properties listed for sale is so low.

The Front Range has an under-supplied market, especially when it comes to re-sale properties.

Blog • Fun Facts • December 16, 2022

Incentivized

by Rondi duPont

More than 75% of all new home builders are using interest rate buydowns as a way to attract buyers to their communities.This is according to new research by John Burns Real Estate Consulting.Builders are fronting several thousand dollars on behalf of their buyers so these buyers can have a lower rate for the first few years of the loan, or in some cases the whole life of the 30 year loan. New home builders with completed homes or ‘standing inventory’ are especially motivated as this type of inventory is costly for the builder to carry.This kind of product offers a terrific opportunity for buyers looking to move soon and who desire a lower interest rate.

Blog • Fun Facts • December 9, 2022

Way Under

by Rondi duPont

The Nation’s real estate market is significantly under-supplied.According to the most recent research from Freddie Mac, the United States has a housing supply deficit of 3.8 million units.The available inventory today is lower than it has ever been in the last 40 years and is 3.5x lower than the peak of 2008.The reason why available inventory is so low, is the low amount of new home starts that have occurred over the last 15 years.Builders have faced many obstacles trying to keep up with housing demand including supply chain issues, labor supply, land availability, water availability, and stricter approval processes.Fewer new homes were built in the decade ending 2018 than any other decade since the 1960’s.The reality is, the obstacles builders face are unlikely to change significantly in the foreseeable future.Low inventory is likely to persist.An under-supplied market is a key reason leading economists do not expect home prices to crash even while the market cools off.

Blog • Fun Facts • August 26, 2022

Like 1993

by Rondi duPont

Here’s a trivia question…

The number of new, single-family homes completed in 2022 will most closely resemble which prior year?

If you guessed 1993, you are correct.

Yes, the number of homes built and completed this year is no more than the number from 30 years ago.

In 2022, there will be just over 1 million single family homes constructed in the U.S. which is the same as 1993.

This is much more than the bottom of construction in 2011 which saw just under 500,000 new homes built.

But it is also much less than the top of 2006 which had almost 1.7 million.

Limited new home construction today is preventing anything close to a glut of inventory on the market which, in turn, insulates us from any sort of major price correction.

Blog • Fun Facts • June 24, 2022

Still Behind

by Rondi duPont

Single family new housing starts in 2022 will show an increase versus last year, will be the most since 2007, and will still be well behind the peak of 2006.

This year, experts predict that a total of 1.1 million single family homes will be started. In 2021 there were 970 thousand new home starts.

The peak occurred in 2006, when 1.65 new homes were started.

So, this year will finish 33% behind the peak.

When we are asked why today’s market is different from the ‘bubble years’ of 2004 to 2007, the difference in new home starts is one reason we cite.

Even though the market is cooling, we remain significantly undersupplied which insulates prices from any kind of dramatic downturn.

Blog • For Buyers • March 14, 2022

New Construction: Why Work with a Buyer’s Agent?

by Rondi duPont

If you’re a buyer, you may have considered purchasing a new construction home. After touring the model home and talking to the builder’s sales representatives, you begin to wonder if it’s necessary to work with a buyer’s agent. Although it’s possible to move forward with the purchase of a new construction home without a buyer’s agent, you may be missing out on the benefits of having a representative at your side. Take a look at how a buyer’s agent can provide value in the purchase of a new construction home.

Buyer Agent vs. Builder’s Agent

Who Works for Who?

A sales representative is the builder’s representation in the sale of a new construction home. They can assist buyers by providing insight into the construction process, available upgrades, and answer questions related to what the builder is able to offer. That said, they represent the builder and will always advocate in favor of the builder. Think of it this way: in new construction, the builder is the seller and the sales representative is the listing agent.

An Expert on Your Side

Knowledge is Power

Working with a buyer’s agent gives you an advantage. Not only do they have experience with new-construction home purchases, but they are also familiar with major builders in the area and can speak to their quality of work. Moreover, buyer’s agents bring a working knowledge of the housing market to the table and can provide insight into current home prices. Tapping into a buyer agent’s knowledge and experience could save you time, money, and stress as you navigate the purchase of your new home!

An Agent is Your Advocate

Your Best Interest Comes First

A buyer’s agent will:

Negotiate on your behalf
Clarify what is included in the base price
Help you navigate the purchase amidst rising building costs
Help you obtain the best financing available
Provide guidance with regard to builder’s warranties and home inspections

Agent Commission

What’s the Cost to Me?

Traditionally, sellers are responsible for paying real estate agent fees. In the case of new construction homes, the builder will likely cover all or most of the agent’s commission. You may be able to work with a real estate professional at no cost to you.

For additional inquiries, please contact me directly.

Blog • Fun Facts • Home Builders • January 14, 2022

Lumber Back Up

by Rondi duPont

The price of lumber has jumped back up again and is adding to the cost of new home construction.

Over the past four months, lumber prices have nearly tripled, causing the price of an average new single-family home to increase by more than $18,600.

According to Random Lengths, as of the end of December, the price of framing lumber topped $1,000 per thousand board feet — a 167% increase since late August.

This most recent lumber price upsurge is due to a number of factors, including:

Ongoing supply chain disruptions
A doubling of tariffs on Canadian lumber imports into the U.S. market that increased price volatility
An unusually strong summer wildfire season in the western United States and British Columbia

Predictions on what lumber prices will do during 2022 are mostly pointing to even higher costs for home builders and ultimately, new home buyers.

Blog • Colorado Housing • December 17, 2021

Construction Openings

by Rondi duPont

It’s not just the availability of materials impacting home builders today, it’s also the availability of labor.

The market could use more inventory. Home builders are trying to catch up.

You’ve likely read the stories about the cost and availability of materials making an impact on home builders’ ability to keep pace with demand.

It turns out they have another factor impacting them as well- labor.

There are more construction job openings than ever before in history.

This is according to a new report from the Bureau of Labor Statistics.

There are 410,000 job openings in the Construction Sector.

A year ago there were 253,000.

If you know of anyone looking for work, there is a good chance a home builder could use the help.