Despite the NAR and Commerce Department reporting an overall decrease in existing home sales and a drop of single-family home construction in June, there is hope on the horizon. A number of the nation’s regions are displaying modest growth in previously owned home sales, and apartment and multifamily construction is surging (thanks largely to the recent change in New York City building codes). In addition, housing starts are up, building permit reports reinforce positive future activity, and most importantly, there are thousands of potential homebuyers ready to tap into the housing market.
According to the National Association of Realtors, existing home sales in Bakersfield, Calif., Fort Myers, Fla., and Las Vegas all showed significant increases from the previous year, while Orlando, Fla., Phoenix, and Oakland, Calif., showed a pickup in existing home sales. On a regional level, existing home sales on the West Coast rose 1.0 percent in June.
CNN Money recently reported that multifamily unit construction increased 42.5 percent in June. Of course, this increase is largely attributed to the latest changes in New York City building codes that allow builders to apply for apartment and condo permits a month early. Yet together, single and apartment construction rose 9.1 percent to an annual rate of 1.066 million units.
What’s more, the National Association of Home Builders said that in June, housing starts were up 9.1 percent to a seasonally adjusted annual rate of 1.066 million, while building permit applications rose nearly 12 percent to a seasonally adjusted annual rate of 1.091 million units.
Despite the bleak state of the overall housing market, it’s vital to look at the market on a local level and consider the facts that point to a positive future. With that said, you must also look to the current pool of potential homebuyers.
One important way to increase market share is to take advantage of those homeowners sitting on the fence. According to NAR President Richard F. Gaylord, (A recent online survey of Realtors’ shows nearly a quarter of potential home buyers are waiting on the sidelines.) With 2009 around the corner and home prices lower than ever before, new homebuyers have the best opportunity to jump into a housing market that will give them the best bang for their buck. Furthermore, first-time homebuyers provide existing homeowners with an out to trade up or avoid paying two mortgages that ultimately cripple their bank accounts as we’ve seen with the recent high foreclosure rate. Young homebuyers are often overlooked by housing industry professionals, yet are responsible for nearly 40 percent of all homes purchased on the market. Ignoring them is just not an option.
In addition, single women account for 20 percent of homebuyers while their male counterparts account for only nine. Single female homebuyers are a typically diverse group consisting of young singles, single mothers, middle-aged divorced, seniors and widows. Although a huge demographic with a vast impact, they are still being ignored by current housing market professionals. Wake up. This group is just too important to be forgotten.
With 2009 seemingly right around the corner, begin planning for next year’s success. Armed with the knowledge of a healthy housing market on the horizon, broaden your understanding of potential homebuyers besides the mainstream Boomers and middle-aged, get to know them, and alter your marketing campaign to successfully target them. Your efforts will lead you to increased market share and an enhanced competitive landscape.
Looking for information on marketing to women and young homebuyers? contact me at 770.518.1000 or sk@kleberandasssociates.com.
Resource Links:
https://www.housingzone.com/probuilder/article/ca6572838.html?nid=2469&rid=86
https://www.nahbmonday.com/houseecon/issues/2008-07-17/index.html
You might also want to check out CNN Money’s 2008 “Best Places to Live.”
