While they aren’t expecting to break any records in 2014, home builders and Realtors do expect to see continuing increases in the construction and sales of new houses.
“I think what we’ll see is gradual improvement as we go through 2014,” said Wess Galyon, CEO of the Wichita Area Builders Association. “I don’t think it’s going to go wild, but I think we’ll see at least a repeat of what happened in 2013 – a trend up a bit.”
Galyon said there were 995 single-family housing starts in the area last year, a 27 percent increase from the 781 starts in 2012.
That boost in 2013, coupled with a slowly improving economy and a lower rate of unemployment, fuels Galyon’s optimism about 2014.
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“The underpinnings look pretty good,” Galyon said. “I think what we have going on is sustainable.”
Those figures are in addition to growth in the sales of new homes in the area. In 2013, new home sales in the area totaled 550 compared with 485 in 2012, a 13 percent year-over-year increase, according to the South Central Kansas Multiple Listing Service.
Cherie Nies Cowgill, vice president of Nies Homes, echoed Galyon’s expectations for new home sales and starts. She said that’s based on what she’s seen in terms of demand at her own company so far this year as well as what she heard at the National Association of Home Builders International Builders Show in Las Vegas, which she attended in early February.
Nationally, the NAHB’s chief economist, David Crowe, is forecasting 822,000 starts in 2014, about 200,000 more starts than last year.
“There are five key points to the turnaround,” he said in a news release announcing the 2014 forecast. “Consumers are back, pent-up demand is emerging, there is a growing need for new construction, distressed sales are diminishing, and builders see it.”
Richelle Knotts, supervising broker for J.P. Weigand & Sons new homes division, said that, beginning last quarter, she noticed an uptick in new development activity, and “builders are jumping back in.”
She said she’s also noticed that builders are starting to build model homes again, which tells her that financing for new home construction is easing for them. The absence of model homes in the past few years, largely a result of the recession, made it harder to sell new homes.
“It’s been a lot better,” Knotts said of the sales environment and the activity she’s seen in the new-home market.