“The San Antonio housing market in the third-quarter of 2014 saw new-home builders generate the highest level of single-family starts since 2007. In addition, new-home closings were the best since 2008.” says Jack Inselmann of longtime director of Metrostudy’s San Antonio market. “New-home inventory overall is still relatively healthy, home prices are increasing and housing values are improving. In addition, new lot delivery has finally caught up with demand thereby beginning to fill a void that has impacted production over the last couple of years. The annual starts increase over a year ago would be higher if the market was able to produce new lots for housing priced below $200,000”, says Inselmann.
In 3Q14 there were 2,693 single family starts which is a 17.1 percent increase when compared to the 3Q13 rate of 2,299. The current Annual Starts rate is 8,927 which is 4.5 percent higher than the 3Q13 annual rate of 8,543. Closings totaled 2,362 which is an 8.2 percent increase over the 3Q13 rate of 2,183. The current Annual Closings rate is 8,406 units, a 3.9 percent increase over the 3Q13 annual rate of 8,088. All of the increases have occurred in housing priced about $200,000 thereby overcoming a decline in starts under $200,000.
Developed lot inventory has decreased for the first time in 18 months in the third-quarter as we had more lot absorption than lot delivery. However, when compared to a year ago developed lot inventory is up 400 lots, from 17,027 to 17,433. This has helped to stabilize the lot inventory and provide some relief to high demand areas that saw their lot supplies diminish over the last three years. “Of course the key difficulty remains in keeping lot costs in line with the San Antonio affordability ratio where it is now virtually impossible to reproduce lots for new housing priced under $175,000.”
Contributed by Metrostudy.