The median existing home price in the region is now $178,000, compared with the new-home median price of $301,904, according to RL Brown Reports.
The gap isn’t expected to shrink anytime soon, said real-estate analyst
RL Brown during his annual housing forecast on Thursday.
Last year, 12,785 new-home permits were issued Valley-wide, up from 11,615 in 2012. But the figure was well below the 14,000 to 16,000 projected earlier last year for 2013.
Other factors, including a construction-labor shortage, a lack of available lots in areas popular with buyers and tighter lending guidelines are working to keep the homebuilding market from a robust recovery, he said.
“It’s certainly true we failed to live up to the optimism of many as we enter 2014, and it’s equally true that at least statistically we appear to have made little progress toward recovery in this housing market,” said Greg Burger, a Brown Reports analyst.
Also, keeping the supply of new homes for sale low are builders who don’t want to construct too many speculative houses they can’t sell quickly.
However, he said some parts of the Phoenix area and certain builders and contractors are seeing increasing signs of a recovery.
Because of a big jump in new-home permits issued for Mesa’s Eastmark community, the Mesa/Gilbert area accounted for 34 percent of all home sales during 2013. The southwest Valley, including the cities of Surprise and Goodyear, was the second-most popular with buyers, ending the year with 22.7 percent of all sales.
The Tempe/Chandler area only drew 3.8 percent of all home sales because of few parcels remaining for residential development. About 5.2 percent of the Valley’s new houses sold in Scottsdale. New houses in the northwest Valley accounted for 19.1 percent of sales. Pinal County sales made up about 8 percent of the market.
Brown said because of tighter lending practices and higher prices, a big increase in new-home sales is unlikely in the near future.
His forecast calls for the pace of new-home building in 2014 to be similar to 2013. The outlook for 2016 is only slightly better.
But Brown said homebuilding should begin to recover more in 2016. By 2017, his company is forecastingas many as 30,000 new houses could be constructed in metro Phoenix.
By Catherine ReagorThe Republic | azcentral.comThu Jan 23, 2014 7:53 PM
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