With Clark County Housing Prices Rising, New Construction Looks Good
The U.S. housing market has been surging over the past two years and all estimates indicate that will continue to be the case for the foreseeable future. Said David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices in a January 2017 press release for Standard and Poor’s, “Home prices continue to advance, with the national average rising faster than at any time in the last two-and-a-half years.” Blitzer added, “Consumer prices are higher today than 20 or 30 years ago, while the inflation rate is lower.”
This is an excellent sign for home builders nationwide because the numbers show that demand for homes is through the roof. With a major increase in demand for homes, that means that by extension, demand is greater than supply and many new homes will have to be built.
While this is indeed a nationwide trend, some areas have an even more robust and booming housing market than the national average.
Washington State builders can rejoice as this is one place where demand is incredible. In fact, home prices in Washington are rising faster than any other state in the country for the first time in over 20 years. These prices are growing at a rate of over 10%, which is double the national average.
Peter Orser, director of the University of Washington’s Runstad Center for Real Estate Studies told the Seattle Times that he believes this isn’t anything that will change in the near future. He also thinks that despite growing demand in Seattle, this phenomenon goes far beyond that city and will continue to do so for quite a while.
In fact, the data backs up Orser’s assertions, as numerous other counties in Washington ranging from San Juan to Jefferson have seen a massive jump in area housing prices. Indeed, out of the 39 counties, 37 saw significant price increases over the course of 2016 and into 2017.
This extends into cities within those counties as well. For example, Vancouver, WA has seen the cost of an average square foot rise a whopping 11% over the past year, which is absolutely remarkable. Vancouver is just the tip of the iceberg, however, as many other cities and counties have also seen a phenomenal increase in housing prices.
One such county is Clark County, the county in which Vancouver exists. While Vancouver itself has done remarkably well with home prices, so has Clark County as a whole. According to RMLS – a real estate listing service, home prices have risen to a level higher than at any time since at least 2000. RMLS says the increase has been above five percent since last July and 15 percent since the previous year. Median home value has now reached over $300,000, which is an extraordinary figure for that County.
Zillow, one of the world’s most trusted real estate sources, projects that the median value of a house in Clark County could reach as high as $310,000 by the end of 2017 and the current median sale price is a massive $370,000.
Again, this is great news for Washington State builders, and even better for those looking to purchase a new home. Buyers won’t have to settle for worn, outdated, inefficient homes that don’t fit their needs. Instead, it’s become a realistic and feasible option to build a custom home of their dreams.
With more and more new home construction expected for the foreseeable future, that increases the likelihood of not only being able to find a desirable home, but finding a home that can be built and tailored exactly to a potential homeowner’s needs and desires. The ability to see the house you have always wanted be constructed from the ground up is the kind of thrill that is hard to come by and generally a once in a lifetime phenomenon for most homebuyers.
This is because the additional housing construction will help bring the levels of supply and demand back in line, and the result would be lower sale prices for pre-owned homes as scarcity is what drives prices up. And, if there is an abundance of new homes built, that means scarcity would no longer be an issue that could cause prices to shoot up rapidly and the rise in sale prices for homes in the area could slow a bit.
While this nationwide trend is advantageous to home builders all across the United States, it is especially advantageous for those in particularly desirable markets. The State of Washington and many of its counties absolutely fit the bill in this regard, as demand for homes in the state has outpaced the national average to an amazing degree and projects to continue to do so for the foreseeable future. This means if you are somebody who not only wants to live in the State of Washington, but wants to own a house there, your chances of doing so are likely about to rise exponentially. But as amazing as it feels to buy a home in your desired location, it is even more amazing to oversee the construction process of the home you’ve always wanted – the house you’ve dreamt about since childhood – constructed from the ground up, something that will soon be a reality for many homebuyers in the state of Washington.
So yes, this trend is a terrific boon to Washington State builders, because the continued overflow of people looking to buy homes is going to result in them to turning to new home construction for a solution in order to purchase a home in most counties in the state, including and especially Clark County.
And, it is an even bigger boon for those looking to purchase a home, because the demand for more housing and subsequent building of new houses to meet that demand means there will be more new homes easily available for potential homeowners. It also means that with supply being driven up to more closely meet demand, the prices for housing may still be high, but should stabilize somewhat.