“Build it and they will come.” That phrase had characterized Clark County’s real estate market for decades. But are we ready to build the housing that will meet the needs of those who help drive the local market: the baby boomers?
The year 2013 was a continuation of the momentum in home sales that started in 2012. Prices continued to modestly increase. With this stability in the market, many savvy but cautious buyers were ready to take the plunge.
This improvement in the housing market also created hope for many homeowners who had suffered substantial losses in value over the past several years and now found themselves in a more favorable position to sell.
The shift from a buyer’s market to a seller’s market came early in the year, when buyers very aggressively returned to the market. The listing inventory in certain price ranges was quickly depleted.
A seller’s market emerged, with multiple offers on some properties, especially in the lower price ranges — less than $200,000, and $200,000 to $250,000. Prompted by low interest rates and good values, buyers continued to pursue homeownership.
The next 12 months should be characterized by an increase in housing inventory. More homeowners will be reaching the point where their equity position is improved enough to no longer be “underwater.” As those sellers enter the housing market, we should see inventories adequate to satisfy a thirsty supply of buyers.
Many baby boomers are homeowners who want to move from a large two-story into a single-level home in a quality, secure neighborhood with perhaps a smaller yard. They are not finding many choices in this category, particularly if they aren’t interested in paying more than $400,000 for the home. They want newer, quality construction — they don’t want to downgrade, they just want to downsize.
If they can find the product to buy, then their home becomes available to those who have outgrown their home and want to move up. That opens up a pre-owned home in the lower price range to first-time homebuyers.
Reliable industry sources project that thousands of new lots will come onto the local market in 2014. These lots, spread throughout the county, were in the preliminary stages of development at the time of the housing crash.
Now they have worked through the final process of development and are ready for building permits. These lots will accommodate a variety of housing product.
It will be a challenge to match up these new subdivisions with the pool of buyers, including those baby boomers. “Move-in ready” new construction should increase as builder — and banker — confidence improves, taking these new homes out of the “proposed” category, which does not attract as many buyers, and into a finished home.
Let’s hope that the “build it and they will come” theory still works here in Clark County. As our housing inventory is increasing, our baby boomer generation must be recognized as a significant contributor to a successful housing market. Their specific housing needs must be met. This could very well be the critical link to how Clark County grows and keeps the housing industry alive and well in 2014.
Carol Curtis is a broker for Windermere/Stellar Group and one of the founding partners of that group. She has been in the real estate profession in Clark County since 1980 and has held numerous community and industry leadership positions.