June 2023 - Hillwood Loves Realtor

Single-Family Building Focused around Baby Boomers: Multifamily is Millennial Focused

Jesse Wade2023-06-28T09:14:37-05:00

NAHB analysis of county level permit data and demographic data indicates that single-family home building in the first quarter of 2023 is occurring mostly in counties where baby boomers make up a majority of the population. The Census Bureau provides county level population age estimates in 5 years intervals. For example: 0-4, 5-9, 10-14 through 85+. Using these estimates, we can segment county populations into six distinct generations and determine which generation has the highest population share in each county. The generations used in the analysis are defined as follows: Generation Alpha (Ages 0-9), Generation Z (10-24), Millennials (25-39), Generation X (40-54), Baby Boomers (55-74) and the Silent Generation (75+). Based on the Census data, the Baby Boomer generation has the majority share of population in 2,605 counties. Surprisingly, Gen Z already has the majority share of population in 335 counties while millennials are the majority share in 179. Gen X, the often-overlooked generational group, is the majority share of population in a mere 24 counties. The silent generation and Gen Alpha make up the majority share in no counites. Single-family home building since 2016 has predominantly been in areas where Baby Boomers are the largest present generation. Below is the single-family home building market share by dominant-generation-by-county dating back to 2016. The Boomer market share has been increasing since the fourth quarter of 2019, when it stood at 52.6% of the single-family construction market. As of the first quarter of 2023, the Baby Boomer market share has increased 5.5 percentage points to 58.1% market share. All other generations have lost market share by this measure over the same period, with Millennials market share falling from 29.1% to 24.7%, Generation X falling from 4.6% to 4.3% and Generation Z falling from 13.7% to 12.8%. Despite millennials making up the majority share of population in just 179 counties, these counties have the largest market share of overall multifamily building. Since 2016, counties where millennials make up the largest share of population have been the leaders in multifamily building with their market share never falling below 52.0% over the 7-year span. As of the first quarter of 2023, areas where millennials make up the largest share of population accounts for 52.3% of multifamily home building. Baby Boomers make up the next highest market share at 35.5% while Generation Z has a market share of 9.4%. Generation X has the smallest market share of only 2.8% of the multifamily building market. Related ‹ New Home Sales Jump in MayTags: Baby Boomers, gen-x, Gen-Z, HBGI, HBGI Featured Topic, market share, Millennial, multifamily, single-family

Single-Family Building Focused around Baby Boomers: Multifamily is Millennial FocusedJesse Wade2023-06-28T09:14:37-05:00

Supply-Chain Issues Lengthened Single-Family Build Times in 2022

Na Zhao2023-06-28T09:15:05-05:00

By Na Zhao on June 28, 2023 • The 2022 Survey of Construction (SOC) from the Census Bureau shows that the average completion time of a single-family house is around 9.6 months, including a little over a month from authorization to start and another 8.3 months to finish the construction. This is almost one month and a half longer than the average completion time in 2021, reflecting supply-side challenges and skilled-labor shortages that persisted throughout the year. The time from authorization to completion varies across the nation and depends on the geographic location and whether the house is built for sale or custom-built. Among all single-family houses completed in 2022, houses built for sale required the shortest amount of time, 8.9 months from obtaining building permits to completion, while houses built by owners (custom builds) required the longest time, 13.4 months. Homes built by hired contractors normally needed around 11.3 months, and homes built-for-rent took about 11.6 months from authorization to completion. The time from permit to start for homes built for sale and built by contractors took much longer in 2022 than in 2021. Between authorization and the start of construction, built for sale and built by contractors on owner’s land took 1.33 month and 1.28 months respectively. The permit-to-start time was even longer for homes built-for-rent (1.53 months), in contrast with the past when construction typically started within the same month after obtaining building authorization. The average time from authorization to completion also varies across divisions. The division with the longest duration was New England (12.6 months), followed by the Middle Atlantic (11.8 months), the Pacific (10.8 months), the East South Central (10.1 months) and East North Central (9.7 months) in 2022. These five divisions had average time from permit to completion exceeding the nation’s average (9.6 months). The shortest period, 8.6 months, is registered in the South Atlantic division. The average waiting period from permit to construction start varies from the shortest time of 24 days in the East North Central to the longest one of 47 days in South Atlantic. The SOC also collects additional information for houses built for sale, including a sale date when buyers sign sale contracts or make a deposit. Looking at single-family homes built for sale and completed in 2022, 25.5% were sold before construction started, 43.9% sold while under construction, 13.9% sold during the month of completion, and 12.7 % sold after completion. The share of completed houses remaining unsold was 4%. Related ‹ New Home Sales Jump in May

Supply-Chain Issues Lengthened Single-Family Build Times in 2022Na Zhao2023-06-28T09:15:05-05:00

San Diego Has Largest Top 10 Builder Market Share in 2022

Eric Lynch2023-06-23T08:17:27-05:00

By Eric Lynch on June 23, 2023 • In a previous blog post, NAHB analyzed the national data released by BUILDER Magazine. Earlier this month, BUILDER Magazine also released Local Leaders data on the top 10 builders in the top 50 largest new-home markets in the U.S. (ranking determined by the number of single-family permits) (Figure 1). The 2022 data shows that the top 10 builders in each of the 50 markets captured at least 36.8% of the market share (Kansas City, MO-KS) and reached as high as 95.5% (San Diego-Chula Vista-Carlsbad, CA), with an overall average of 73.3%, up from 68.1% in 2021. Analyzing the map in more detail shows clusters of metro-markets in Florida, Indiana, Maryland, Ohio, South Carolina, Virginia, and Southern California with highly concentrated markets. Less concentrated markets include metro areas in Texas and metros in the Midwest region. Among the builders, Lennar Corp. and D.R. Horton both had a presence in 42 of the top 50 metro areas in 2022, followed by PulteGroup with 33 appearances. From 2021 to 2022, 44 metro areas saw an increase in their top 10 builders’ market share while only 3 metro areas saw decreases. The top 5 metro areas with the biggest increases were: Portland-Vancouver-Hillsboro, OR-WA (+16.6%) Seattle-Tacoma-Bellevue, WA (+15.9%) New York-Newark-Jersey City, NY-NJ-PA (+12.9%) North Port-Sarasota-Bradenton, FL (+11.7%) Nashville-Davidson–Murfreesboro–Franklin, TN (+11.4%) The three metro areas that experienced decreases in their top 10 builders’ market share were: St. Louis, MO-IL (-10.4 percentage points) Indianapolis-Carmel-Anderson, IN (-4.3 percentage points) Salt Lake City, UT (-1.1 percentage points) The top 10 builder market share in St. Louis, MO-IL has experienced decreases for 5 consecutive years; the metro area reached its peak of 86.8% in 2017 and its market share has since been cut in half to 42.1% in 2022. Related ‹ Employment Situation in May: State-Level AnalysisTags: Local Leaders, Top 10 Builders, Top Builders

San Diego Has Largest Top 10 Builder Market Share in 2022Eric Lynch2023-06-23T08:17:27-05:00

Employment Situation in May: State-Level Analysis

Danushka Nanayakkara-Skillington2023-06-22T09:16:35-05:00

Nonfarm payroll employment increased in 39 states and the District of Columbia in May compared to the previous month, while 11 states lost jobs. According to the Bureau of Labor Statistics, nationwide total nonfarm payroll employment increased by 339,000 in May, following a gain of 294,000 jobs in April. On a month-over-month basis, employment data was strong in Texas, which added 51,000 jobs, followed by California (+47,300), and New York (+30,400). Eleven states lost a total of 20,500 jobs. In percentage terms, employment in Utah increased by 0.5% while Vermont reported a 0.4% decline between April and May. Year-over-year ending in May, 4.1 million jobs have been added, marking a more than full recovery of the labor market from the COVID-19 pandemic induced recession. Except for Rhode Island, all the other states and District of Columbia added jobs compared to a year ago. The range of job gains spanned 529,800 jobs in Texas to 2,200 jobs added in West Virginia. Rhode Island lost 2,100 jobs on a year-over-year basis. In percentage terms, Texas reported the highest increase by 4.0%, while Rhode Island decreased by 0.4% compared to a year ago. Across the 48 states which reported construction sector jobs data—which includes both residential as well as non-residential construction— 23 states reported an increase in May compared to April, while 21 states lost construction sector jobs. Four states, Alaska, Kansas, Maine, and West Virginia reported no change on a month-over-month basis. California added 6,500 construction jobs, while Indiana lost 2,500 jobs. Overall, the construction industry added a net 25,000 jobs in May compared to the previous month. In percentage terms, Louisiana increased by 1.3% while Rhode Island reported a decline of 4.9% between April and May. Year-over-year, construction sector jobs in the U.S. increased by 192,000, which is a 2.5% increase compared to the May 2022 level. Texas added 21,100 jobs, which was the largest gain of any state, while Colorado lost 1,800 construction sector jobs. In percentage terms, Arkansas had the highest annual growth rate in the construction sector by 10.2%. Over this period, Connecticut reported a decline of 2.6%. Related ‹ Top 10 Builder Share Jumps in 2022Tags: construction labor, economics, state and local markets, state employment

Employment Situation in May: State-Level AnalysisDanushka Nanayakkara-Skillington2023-06-22T09:16:35-05:00

Top 10 Builder Share Jumps in 2022

Eric Lynch2023-06-21T07:33:43-05:00

By Eric Lynch on June 21, 2023 • The Top 10 builders captured 43.2% of new single-family home closings (i.e., sales) in 2022, the highest percentage on record based on data released by BUILDER Magazine; this is a 9 percentage point increase from 2021, the largest year-over-year increase since NAHB’s tracking began in 1989. This share represents 276,941 closings out of the 640,500 new single-family home sales reported by the U.S. Census in 2022. However, these closings only represent 27.1% of single-family completions, a broader measure of home building that includes (not-for-sale) home construction. Data for the past three decades reveals a continued upward trend in the top 10 builder share by closings. In 1989, the top 10 builders captured 8.7% of closings. By the year 2000, the share was 18.7%; and by 2018, 31.5%, reaching above 30% for the first time. After edging down in both 2019 and 2020, the share has broken the record-high in consecutive years, achieving 34.4% in 2021 and 43.2% in 2022. As for the top 10 builder share by completions, the share was at 5.6% in 1989, rose steadily to a pre-Great Recession peak of 17.9% in 2006, and after a brief decline, it has continued a similar steady climb to 27.1% in 2022 (Figure 1). The gap between these lines in 2022 is due to a relative gain in not-for-sale construction, which includes custom and built for rent units. Nine of the top 10 builders remained the same from 2021 to 2022: the only change was LGI Homes, which was replaced by Toll Brothers. There was one change with regards to ranking; Meritage Homes Corp and Taylor Morrison switched ranks, with the former rising to the fifth position while the latter is now seventh. D.R. Horton remains the top builder for 2022, capturing 12.9% of the market with 82,930 closings (Figure 2). This is the second consecutive year that D.R. Horton has achieved a market share greater than 10% and the 21st straight year that D.R. Horton has occupied the top spot. Lennar is ranked second with 10.7% in market share, which is the first time that the company has reached double-digit market share, and PulteGroup is third with 4.5%. This is the third year that the Top Three builders (D.R. Horton, Lennar, and PulteGroup) have a combined market share of over 20% (2018: 20.4%, 2021: 22.0%. 2022: 28.1%). BUILDER Magazine also released Local Leaders data on the top 10 builders in the top 50 largest new-home markets in the U.S. (ranking determined by the number of single-family permits), which NAHB will analyze in another post later this week. Related ‹ Single-Family Starts Post Solid Gain in MayTags: Top 10 Builders, Top Builders

Top 10 Builder Share Jumps in 2022Eric Lynch2023-06-21T07:33:43-05:00

How to Avoid Moving Company Scams

Texas REALTORS Staff2023-06-20T01:33:52-05:00

Whether you’re relocating across the country or across town, you’ll need help moving your possessions. Moving companies can be a great resource, but stay alert for scams that could ruin your move. The Federal Motor Carrier Safety Administration offers tips for a successful move—including red flags that might indicate you’re being scammed: The mover or broker doesn’t perform an on-site inspection of your household items and gives an estimate over the telephone or online. The mover or broker doesn’t provide a written estimate or says they will determine the cost after loading. The moving company demands cash or a large deposit before the move. The mover asks you to sign blank documents. The mover or broker doesn’t provide you with a copy of the Your Rights and Responsibilities When You Move booklet and a copy of FMCSA’s Ready to Move brochure, which movers are required by federal regulations to supply to their customers. The company’s website has no local address and no information about their registration or insurance. The mover claims all goods are covered by their insurance. On moving day, a rental truck arrives rather than a company-owned or marked fleet truck. The mover claims that you have more belongings than estimated. Get more resources to ensure a successful move.

How to Avoid Moving Company ScamsTexas REALTORS Staff2023-06-20T01:33:52-05:00

Building Materials Prices Fall for Second Month Straight

David Logan2023-06-15T13:18:55-05:00

According to the latest Producer Price Index report, the prices of inputs to residential construction less energy (i.e., building materials) decreased 0.1% in May 2023 (not seasonally adjusted), following a 0.2% drop in April. The index has gained 0.3%, year-to-date, a stark contrast from the 10.2% and 4.9% YTD increases seen in 2021 and 2022, respectively. The PPI for goods inputs to residential construction, including energy, declined 0.5% as energy prices drove the index lower. The index has declined 2.7% over the past 12 months but is 36.0% higher than it stood in January 2020. Gypsum Building Materials The PPI for gypsum building materials fell 1.1% for the second month straight and is down 0.4%, year-to-date. Gypsum building materials prices are 4.0% higher than they were a year ago but at the lowest level since July 2022. Softwood Lumber The PPI for softwood lumber (seasonally adjusted) decreased 3.1% after increasing 6.2% the prior month. Softwood lumber prices have declined 10 of the past 12 months and are 41.9% lower than they were one year ago. Ready-Mix Concrete Ready-mix concrete (RMC) prices were revised down for April in the latest release. As a result, prices declined last month for the first time since March 2022. Unfortunately, price growth returned in May as the RMC index increased 1.6%–the largest monthly increase in nearly a year. RMC prices have risen 2.8% YTD—the same increase seen through May 2022—and are up 13.0% over the past 12 months. Steel Mill Products Steel mill products price growth continued to accelerate in May as the index rose 5.2%. This comes on the heels of 3.5% and 1.0% increases in April and March, respectively. after climbing 3.1% in February and March combined. The PPI for steel mill products declined eight consecutive months ending in January, falling 27.9% over that span. However, prices have climbed 12.4% in the four months since. Services The price index of services inputs to residential construction decreased 1.0% in May after rising 0.5% in April. Prices have declined 12.4% over the past year but have been relatively stable in 2023, down just 0.5% through May. Related ‹ A Hawkish Pause: Landing Flare for the Fed?Tags: Building Materials, building materials prices, construction costs, Gypsum, inflation, lumber, ppi, producer price index, ready-mix concrete, softwood lumber, steel

Building Materials Prices Fall for Second Month StraightDavid Logan2023-06-15T13:18:55-05:00

Moving? You Don’t Have To Take Everything With You

Texas REALTORS Staff2023-06-06T01:15:20-05:00

If you’re like most people, you accumulate a lot of things over time. It happens gradually, just one chair, painting, bike, TV, board game, or mixing stand at a time. All those possessions add up, though, which is never more evident than when it comes time to move. A little thought and planning Make Your Decisions Now Why lug an old couch—or pay someone to do it for you—if you’re going to replace it shortly after you get to your new home? Not only can getting rid of things before the move save time and money, it will help you start fresh at your new residence without a lot of clutter Offer Good Items to the Next Person If you own your current home, you can consider adding certain items that convey with the sale, such as freestanding appliances, artwork, landscaping machines, and more. (Keep in mind that most permanently installed and built-in items are considered part of the sale unless specified in the contract as an exclusion.) Sell It Estate and garage sales are options to get rid of large amounts of possessions at once. Individual items can be sold online through Facebook, eBay, and other online platforms. You can also check with friends and neighbors who may have an interest in purchasing items you no longer want. Give It Away Some charities may pick up large items if they are on their wish list; others have drop-off locations. You can also post items to Buy Nothing groups and ask acquaintances if they know anyone looking for the things you no longer want. Pay Someone to Haul Off the Big Stuff For large items in disrepair, you may have to hire a company to take it away. The good news is that you won’t have to do the dirty work yourself before moving day will make your experience much more pleasant. Your REALTOR® can help you understand what items are included in the sale of a home you are moving from or to, and can assist if there are particular items you’d like to ensure stay with the property.

Moving? You Don’t Have To Take Everything With YouTexas REALTORS Staff2023-06-06T01:15:20-05:00

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