Welcome to today’s real estate news roundup! In this edition, we bring you the latest updates on the housing market, impact fees, home construction, and framing lumber prices. Forbes Advisor explores predictions for when home prices will become affordable again, shedding light on recent developments that have brought some relief to prospective buyers. A recent Supreme Court ruling could potentially give developers more power to fight against burdensome impact fees, which have been a significant hurdle in building new housing. We also delve into the increase in U.S. housing starts driven by multifamily construction and the challenges posed by high interest rates. Lastly, we discuss the stabilization of framing lumber prices after weeks of decline and the impact it has on the affordability of new homes. Dive into these stories to stay informed about the ever-evolving real estate landscape.
Housing Market Predictions For 2024: When Will Home Prices Be Affordable Again? – Forbes Advisor
What many had hoped would be a rosy spring home-buying season ended as a thorny challenge for many prospective home buyers already demoralized by a frustrating market. Yet, even as sales stalled amid elevated mortgage rates and home prices, one silver lining emerged—more resale inventory entered the market, which has begun to put some downward pressure on the pace of home price growth. Other good news for home shoppers is the decline in the median price for a new home—now below the median resale home price—even as builders continue offering incentives to lure buyers.
Supreme Court ruling may give developers more power to fight impact fees
Jonathon Yu, a product manager, encountered significant impact fees when he submitted plans to build new housing in Sunnyvale. The fees imposed by local governments to fund infrastructure improvements can often surpass six figures per unit. However, a recent U.S. Supreme Court ruling could limit the impact fees that California can levy, potentially lowering barriers to building new housing. The ruling found that previous standards for such fees were incorrect, and it remains to be seen what new standards the California court will adopt. Critics argue that the fees have been unjustified and burdensome for developers, while proponents argue they are necessary to support growth and maintain services. Lowering impact fees could stimulate housing production and provide long-term revenue streams for cities.
U.S. housing starts increase on pickup in multifamily construction
New U.S. home construction picked up in June, driven by a surge in multifamily construction. However, there was a decline in single-family housing starts to an eight-month low, indicating challenges in the real estate market due to high interest rates. Building permits also rose, primarily fueled by applications for multifamily projects. The report suggests that builders are adjusting their focus to align inventory with demand. Builder sentiment has declined, and the industry is hopeful for a reduction in interest rates. The data also showed a significant increase in total housing completions, mainly driven by multifamily projects.
Framing Lumber Prices | NAHB
The framing lumber composite price experienced a slight increase after several weeks of decline, signaling potential stabilization in the market. NAHB tracks the latest lumber prices and provides insights into the U.S. framing lumber market. Softwood lumber prices have been volatile due to factors such as increased demand, rising tariffs, supply-chain bottlenecks, and limited domestic production. The cost of softwood lumber directly impacts the price of new homes, contributing to declining affordability. NAHB advocates for actions to address high lumber prices and ease supply-chain challenges. To learn more about framing lumber prices and NAHB’s efforts, explore the full lumber report.