At Lambert Ranch, an Irvine, California, housing development where prices start at $1 million, just two of 98 homes are unsold since the project opened in May.
The builder, New Home Co., is opening 14 neighborhoods in California this year for buyers who want to seize on low interest rates amid a scarce supply of homes for sale.
“Everywhere we are, we can see it,” Larry Webb, chief executive officer of Aliso Viejo, California-based New Home, said in a telephone interview. “Talk about pent-up demand.”
U.S. home sales and prices are poised to rise in 2013, solidifying a recovery that began last year after a half-decade slump that was the deepest since the Great Depression, according to analysts and economists surveyed by Bloomberg. Record-low mortgage rates and attractive prices, supported by declining unemployment, are luring buyers as the inventory of distressed homes shrinks. Homebuilders are responding by adding supply, bolstering economic growth.
“Increased new residential construction activity will lead to employment gains, which should translate into higher consumption and modest GDP growth,” Robert Wetenhall, a homebuilding analyst with RBC Capital Markets LLC in New York, said in a telephone interview. The U.S. budget deal reached this week removes a cloud to that outlook, he said.
Sales of existing homes will rise about 7.2 percent in 2013 to 4.98 million, the highest since 2007, based on the median estimates of 15 economists and housing analysts surveyed by Bloomberg News for this story. Prices will gain 3.3 percent after an estimated 4.5 percent jump in 2012, according to the forecasters, who used varying measures of values.
Building is set to jump after the inventory of new homes fell last year to the lowest level in half a century. Housing starts, including single- and multifamily units, are expected to increase 24 percent to 967,000 in 2013, the most since 2007, according to the median of 17 estimates. Starts will reach an annual pace of 1 million by the end of this year and 1.5 million by the end of 2016, according to a report today by Goldman Sachs Group Inc. analysts led by Hui Shan, who said housing will remain a “bright spot” in 2013.
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Senior Director, Coldwell Banker New Homes Division
With over 200 condominium, townhome and loft projects successfully marketed
“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”