According to an article in REALTOR Magazine, David Crowe, chief economist of the National Association of Home Builders, projected single-family housing starts to rise by 21 percent in 2011, reaching 575,000 units. Location of new construction will vary throughout the region based upon demand.
This estimate assumes job growth, increasing U.S. population, as well as continued low interest rates will drive new home construction.
Credit is a factor. Lending remains tight, but if it opens up with safe underwriting standards for creditworthy buyers, there could be a bigger boost to the housing market benefiting the broader economy. The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent, according to NAR.
In addition, over the past 10 years the U.S. has added 27 million people. Continued population growth will also spur home construction and sales.
For more information about new home construction consult Kevin Toll.