Here’s an idea to help ease the housing shortage we are currently in.
Increase new home construction.
Wow, what a simple solution to a problem. But hold on just a second here, maybe it’s not quite that simple.
There are many forces that make it difficult for Builders to just start building more houses. Here are a few of the bigger ones.
Land, or the lack thereof.
If a Builder wants to build affordable lower-priced housing for the starter market, there is plenty of land. However the land is not near the jobs. If a builder wants to build these starter homes anywhere near a large metro area, there is no land available. I live in Freehold Township. And there is not, and has not been for quite some time, any large parcels of land to make it worthwhile to build in. Thirty or fourty years ago, there are many large parcels available. Look at Stonehurst. Lots and lots of homes, they were actually so many homes built that the town made them build the school to educate all the children and families that would be moving in. However now, if you can find a building lot here or there in town you’re doing pretty good.
Lack of Skilled Workers
The next hurdle that these builders have is a lack of skilled construction and trade workers. During the recession, many of these skilled laborers had to find other jobs since there were no construction jobs available. Now the housing market has recovered, but these workers have not returned. As I speak with builders and contractors I find out their biggest concern is the lack of younger people coming into the construction job market. And the workers who remain are starting to get older and getting ready to retire. You can’t build a home if you don’t have qualified laborers to do the work. In fact, I recently read that the construction industry in the United States currently has more than 250,000 job openings that they cannot fill.
Cost of Materials
The next issue is the cost of materials needed to build that new home. The cost of materials keeps going up
Financing
The next hurdle these builders face is the cost of borrowing money. Many small community banks have been closing, and most of the banking industry is the big boys. Add tougher lending standards that have been put in place by the government, and it’s getting more expensive and more difficult for Builders to get the necessary financing.
Bottom Line
What all this means, is that whatever new construction is out there it’s much more profitable for the builders to build the larger, more expensive homes. And this is why we have no new construction starter homes.
There’s another way you can do your part to help the housing shortage, which is most prevalent in the starter home market. How can you help? Sell your home. Call us, we can help you with that. Call Bunny and Art Reiman – the Adult Community Specialists.
Search the adult community homes for sale in Monmouth County.