If you’re thinking about buying a home anywhere in our Huntsville Alabama metro area, you might be focusing on previously owned ones. But as you know, new construction developments are finally catching up in production of new homes in our North Alabama. It definitely makes sense to consider all your options, and that includes a home that’s newly built.
New Construction Homes Number Is on the Rise Again
While there are more houses for sale right now than there were at this time last year, there’s still a historically low number of homes available on the market. One reason for that is years of underbuilding—meaning there haven’t been enough new homes built to keep up with demand in most cities in the USA. However our local real estate market in Huntsville, Alabama and surrounding counties has been very steady.
The graph above shows how low the production of newly constructed homes has been over the past 14 years. But it also shows another important trend: the number of new homes being built each year is on the rise. As Mark Fleming, Chief Economist at First American, shares, that’s good news for buyers:
“While existing-home inventory remains limited, the silver lining for home buyers is that new-home inventory is on the rise, and a new home at the right price is a pretty good substitute.”
Builder Incentives Can Provide a Boost
While there a growing number of new homes for sale, builders are slowing that pace until they sell more of their current inventory. According to Logan Mohtashami, Lead Analyst at HousingWire:
“The builders have to work off the backlog of homes, but instead of 3%-4% mortgage rates, they’re dealing with 6% plus mortgage rates, which means they have to provide many incentives to make sure those homes sell.”
Many builders are now offering incentives to help buyers purchase these homes. Fleming also explains:
“The National Association of Home Builders reported that nearly two-thirds of builders were offering incentives, including mortgage rate buydowns, paying points for buyers and price reductions, which could entice potential home buyers.”
A builder who’s willing to pay to reduce your mortgage rate could be a game changer. Ksenia Potapov, Economist at First American, puts it this way:
“A one percentage-point decline in mortgage rates has the same impact on affordability as an 11 percent decline in house prices.”
Should You Buy a Brand-New Home?
The best way to decide what type of home to buy is to work with a trusted real estate professional who can help you weigh the pros and cons of each option. If in Huntsville, you know you can count on John Wesley Brooks and The Brooks Family Of Realtors. They know which homes are available in your local Huntsville metro market, and as new construction specialist they know which builders might be offering incentives that make sense for you.
Even though there aren’t a lot of discounted homes for sale today, new home inventory is on the rise around the US, and many builders are offering incentives just like pre-pandemic years.
If you are interested in our North Alabama, you must understand that working with a local real estate agent who can help you weigh the pros and cons of shopping for a new home versus an existing one is key. Working with a new construction expert like John Wesley Brooks and Family is a double benefit for you.