Recently I've been working a lot with clients interested in new construction, and it's amazing to see the impact that the sluggish housing market is having on local home builders.
The Commerce Department on Thursday reported that in 2007 new construction was down 25% from the previous year. That's the biggest drop in 27 years. In December alone construction fell by over 14% nationwide. As I've visited various new home sites in Tucson, it's easy to see the local impact. Many big name builders are laying off employees left and right, or consolidating home site offices to save money. On several occasions I've found that new builder home sites are cutting back the days and hours they're open to save money.
I've also noticed that several builders are desperate to sell. Certain areas in Tucson will always be stronger price wise, and certain builders aren't as flexible with pricing as others, but in certain areas there are great deals to be found. This week I've visited Rancho Sahuarita and found some incredible incentives with several builders. One builder site in particular is offering prices about $100K lower then what they were in 2005. For those of you that aren't familiar with Rancho Sahuarita, it's a master planned community about 20 minutes South of Tucson. It's really a great little community with tree lined streets, several clubhouses, pools, a huge fitness center and lots of other amenities. At one time the community felt somewhat isolated, but the addition of several new retail sites has helped the area tremendously. Home prices in Rancho Sahuarita tend to be lower then Tucson because of it's distance from the city. It's a straight shot North on I-19 into Tucson, so for those that work in Central, South or West Tucson, Rancho Sahuarita is pretty convenient location to live. The area is now saturated with homes for sale; the slow housing market has increased inventory and availability in Tucson so fewer people are considering Sahuarita.
The Commerce Department on Thursday reported that in 2007 new construction was down 25% from the previous year. That's the biggest drop in 27 years. In December alone construction fell by over 14% nationwide. As I've visited various new home sites in Tucson, it's easy to see the local impact. Many big name builders are laying off employees left and right, or consolidating home site offices to save money. On several occasions I've found that new builder home sites are cutting back the days and hours they're open to save money.
I've also noticed that several builders are desperate to sell. Certain areas in Tucson will always be stronger price wise, and certain builders aren't as flexible with pricing as others, but in certain areas there are great deals to be found. This week I've visited Rancho Sahuarita and found some incredible incentives with several builders. One builder site in particular is offering prices about $100K lower then what they were in 2005. For those of you that aren't familiar with Rancho Sahuarita, it's a master planned community about 20 minutes South of Tucson. It's really a great little community with tree lined streets, several clubhouses, pools, a huge fitness center and lots of other amenities. At one time the community felt somewhat isolated, but the addition of several new retail sites has helped the area tremendously. Home prices in Rancho Sahuarita tend to be lower then Tucson because of it's distance from the city. It's a straight shot North on I-19 into Tucson, so for those that work in Central, South or West Tucson, Rancho Sahuarita is pretty convenient location to live. The area is now saturated with homes for sale; the slow housing market has increased inventory and availability in Tucson so fewer people are considering Sahuarita.
As we all know, when the real estate market is hot, people will buy homes every and anywhere they can find them. When the market slows and there's a bigger inventory, areas that may be a little more isolated begin to struggle. That's when we see the great incentives and deals to draw buyers in.
1 comment:
When the market slows and there's a bigger inventory, areas that may be a little more isolated begin to struggle.
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Julie
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