Posted in Nashville Market | Posted on 09-02-2014 | Written by Metrostudy News
September 2014: Metrostudy’s 2Q14 field research of the Nashville eight county region housing market showed positive signs of construction growth as well as a tightening of available finished lots in more desirable areas.
Builders begin construction on 1,592 new homes in 2Q14, up 9% year over year from 2Q13 starts, and a 10% increase from the prior quarter starts level. On an annual bases construction starts were up by 23% year over year ending in June 2014 with builders starting 6,138 new homes during the past 12 months.
New home closings experienced a 9% increase in 2Q14 compared to the same period one year earlier coming in at 1,402 closings for the quarter. Closings increased from the prior quarter as well and were up by 14%. The trailing 12 months of activity in the area resulted in 5,570 new home closings in the area through 2Q14, up 21% year over year.
With demand for new homes increasing Finished Vacant housing inventory (houses 100% finished and ready to be moved into) increased by 21% year over year to 804 units “But the FV months supply remained the same as from one year earlier, which is a low 1.7 months supply,” said Eugene James, director for Metrostudy, a local housing research company. “Equilibrium is about 2 to 2.5 months thus an under supply of finished homes still exists,” said James.
Although demand for new homes has been rising over the past few years and construction starts have been increasing, the delivery of finished buildable lots has not kept pace with this activity. Currently there are 11,604 Vacant Developed Lots in the region which calculates out to about a 23 month supply. However, certain submarkets have lot supplies as low as 14 months, and as a result, lot prices have increased substantially. “The end result will be higher home prices coming very soon,” said James.
For information contact Eugene James @ 404-510-1080
Metrostudy, a Hanley Wood company, is the leading provider of primary and secondary market information to the housing and related industries nationwide. Established in 1975 in Houston, Metrostudy provides research, data, analytics and consulting services that help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day. www.metrostudy.com
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