What you’re seeing is a realistic approach to current conditions — we are building to meet the market. We will still have a healthy and even robust housing market in some sectors and at some price points, but because of the approach builders are taking, we’re not going to be overbuilt. It’s a realistic perspective that builders are taking.
Biggest source of concern for builders:
One big concern is lot supply. Going forward, the question everyone is asking is whether there will be an adequate amount of lots available in growth areas, and at what cost? Also on everyone’s mind is the drought — is there going to be an impact on development from the potential lack of water? And, as in other markets, the ever-increasing amount of construction defect litigation continues to be a problem.
All of these are risk factors, along with the obvious one — the current economic slowdown — which have led to less building activity. On the positive side, they have really muted the growth debate here.
Market trends:
We’ve had a robust loft and infill market that has softened considerably in the past year. There’s also been an increased emphasis on the seniors market and on “lifestyle product.” This includes single-family as well as attached homes.
The remodeling market is doing very well here. Our members who do remodeling are having a challenging time meeting all the demand. The refinancing market, through which home owners are getting cash for home improvements, has been a real boon to the remodeling and rehabilitation sectors.
Photo courtesy Denver Metro Convention and Visitors Bureau.
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