Buy a House If You Can Find One

Oct. 19, 2020 – There is an interesting statistic released by the National Association of Home Builders: Home sales are outpacing starts by a historic margin. Housing demand has increased so rapidly in recent months that there is now an unprecedented gap between sales and home construction. Sales of new single-family homes in August increased 4.8% to an annual rate of 1.01 million units – their highest pace since September 2006. Moreover, Census estimates and NAHB surveys indicate builders are selling homes that have not begun construction in greater numbers. August sales of those homes are 69% higher than a year ago. The strength of housing demand continues to be largely fueled by historically low interest rates and the growing appeal among consumers to live in lower-density markets. However, prospective buyers must contend with historically low inventory of homes. Inventory of new single-family homes for sale fell to a 3.3-month supply (282,000 units) in August – 40% lower than last year, and the lowest on record dating back to 1963. It takes 400 tons of aggregates to construct the average modern home, according to the National Stone, Sand & Gravel Association, so this is very good news for aggregates producers.