Data released in September, by the National Association of Home Builders, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development illustrates a growing problem of housing affordability nationwide.
The information shows there is a “mismatch between the actual prices of new homes and the prices buyers expect to pay — providing further evidence for the growing problem of housing affordability,” the article states.
NAHB tabulation of the data shows that the median sales price of single-family homes started in 2018 was under $322,000. Nearly 73 percent of the homes were priced between $250,000 and $1 million; while 3 percent were under $150,000. There were no homes under $100,000.
According to NAHB’s “What Home Buyers Really Want” 2019 edition — based on a 2018 survey of approximately 4,000 recent and prospective buyers — the median price buyers expect to pay for a home is about $254,000. Fewer than half expect to pay $250,000 to $1 million, while 27 percent are looking to pay less than $150,000, and 12 percent want to pay under $100,000.
Factors, such as the ongoing shortages of labor and lots, and escalating regulatory costs have made it difficult to impossible to produce a new home at these lower price ranges. With cost factors preventing new homes from being built at prices they can afford, and a limited number of existing homes available on the market, many buyers are left with few options beyond voicing their affordability concerns.
This is an issue that Sable Homes President John Bitely has been paying close attention to here in West Michigan and has identified as a concern.
“One of the biggest challenges and concerns I have is affordability of the homes themselves, especially for the same skilled trades workers — working class America — we employ,” Bitely said during a recent live interview on Wood Radio’s Corp! Magazine CEO Spotlight segment with Justin Barclay. “We see a lot of communities that are being exclusionary in their zoning and they’re not allowing developments that are not expensive and fancy enough.”
Read the full NAHB report, here.