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South Texas leads the Nation in New Construction
1518 Views ::
0 Comments ::  :: South Padre Island, Port Isabel, Laguna Vista, Investment, Economy |
Single-family permits issued over the last 12 months in comparison to permits over the prior 12 months reveals three primary categories of supply:
1. Appropriately slowing down: Builders are slowing construction appropriately in Southeast Florida, Northern California, the Midwest, and the Mid-Atlantic area (Washington, D.C., area). Generally building communities should be done at a reasonable pace, rather than building through them at an accelerated pace or halting development altogether. Demand has slowed more than construction has slowed, which is leading to price reductions and incentives.
2. Not slowing fast enough: Aggressive land buying in three of the softest markets in the country has contributed to rising community counts and construction levels that should be slowing more rapidly. These markets are Southern California, the Southwest and Southwest Florida. These are the 3 of the 4 markets (the other being Southeast Florida) where there is concern that home builders will be losing money several years from now.
3. Growing fast: Construction is up in Texas, the Carolinas and Georgia because the housing market is on solid footing in these areas. Because of low barriers to entry, these markets did not appreciate significantly this decade, and they are not appreciating rapidly now. Single-family permits is at or near an all-time high in these regions.
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