Real Estate is Changing

New home starts have been well below the average yearly requirement for the last 6 years. This is and will be a recognizable problem for home buyers as interest rates continue to rise.

True or Untrue?

New home construction has always followed the auto industry trends. After all, the automobile industry has always been the economic benchmark and prognosticator of the US economy. Not so much anymore! Cars you buy today include all of the bells and whistles we may not want, we will probably never use, add to the base price and maybe nice but not necessary. This is the same with new homes.

We have been led as sheep to think that “keeping up with the Jones” was the pinnacle of success. Comparing yourself to your peers or your neighbors has been drummed into our psychic for years and years. No wonder our individual responsibilities and thought processes have been eroded over time.

I have always thought that we have too many choices but we don’t really exercise choices since we are mostly creatures of routine. This is certainly the case in the grocery stores when you can select from over 200 different cereals but from only a few producers. As kids, we always wanted to try something different and as adults, not so much.

The method of home buying is changing rapidly and the choices one has are dwindling. Multigenerational housing is changing the dynamics of the spaces and use but are we keeping up with the evolution of demand?

The last entrepreneurial transaction between a willing seller and a willing and able buyer is slowing being boxed up into a neat legal box rendering real estate negotiations insignificant.

Real estate is changing before our eyes! Of course not in every market because you can’t compare what is going on in Las Vegas to the Nashville market. However, there are trends in the industry guided by events and government actions that affect all markets. Price is and always will be king.

There are still plenty of “finished lots” on the market but not in the best locations. Builders would be best served buying lots from banks at reduced pricing even for marginal located subdivisions.