Housing starts, permits hit record lows in April
Ok at first glance you look at the headline and think, just
another sign of the housing meltdown. Being in the real estate business, I look
at this stat as great news. Sure slower construction means less jobs, slower
growth, less tax revenue, etc.. But it also means the new supply of homes is
slowing.
The Reno Sparks housing market was/is way overbuilt. Simply put,
there are not enough people to fill up all the houses out there. When demand
drops (like is obviously has) and supply goes up (10-12 month supply not
counting new construction) you have a market that can go no where but
down.
Lower interest rates, lower prices, and tax incentives are slowly
bringing demand back. The last thing we need is more supply, we need to time to
clean up the inventory we have.
There is no doubt in my mind the market here in Reno Sparks is
stabilizing, but it remains fragile.
Note to Home Builders: Give the market a chance
to recover before you start pumping out new houses by the thousands.
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