Much to everyone's great relief, the housing market finished on an upswing in 2015, but will 2016 bring more of the same? And what's the outlook for new construction? Here's a glimpse into the future through the eyes of some industry experts.
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Thanks to declining unemployment, overall economic expansion and solid consumer demand, forecasters are already predicting strong growth for the housing market this year. This includes new home construction, specifically, single-family homes.
In fact, according to the National Association of Home Builders (NAHB), 2016 looks to bring a 27% increase in single-family starts from 2015, which was already up 11% from the year before.
While this sounds incredibly positive, experts do caution key obstacles remain that could prevent this boon from reaching its full potential. Perhaps most significant are limited availability of lots and labor. Other concerns are rising material costs and higher interest rates that had previously been at historic lows.
Still, even with higher interest rates, experts indicate increased demand should remain steady because of improved employment figures, a key driver in the housing market. Ultimately, more jobs mean more income and therefore more potential buyers for both resale and new construction homes. Good news for sellers, buyers and Real Estate Professionals alike.
Where to find new construction
During the past few years, new construction for single-family homes has rebounded in all regions across the U.S., with the strongest recoveries happening in Louisiana, Montana, North Dakota, Texas and Wyoming. And by the end of 2017, the NAHB predicts that "the top 40% of states will be back to 99% or more of normal production levels."
How American Home Shield® can help with new construction transactions
By offering a product tailored specifically to the new construction market, AHS® offers a smart and easy way to help Real Estate Professionals capitalize on this opportunity, wherever they may be.
At first, it may seem like a home warranty would be less crucial for new construction. But, newly built homes aren't always trouble free. Unfortunately, breakdowns often happen even in brand-new homes. While a builder warranty is typically provided with new construction, it usually expires after one year and may not cover breakdowns of some home appliances or system components. The AHS New Construction Home Warranty provides coverage for a new construction home for years 2-5. This can be a great comfort for homeowners looking for ways to protect their new, and often biggest investment.
Here's how it works:
• The first homeowner of a newly constructed home can purchase the AHS® New Construction Home Warranty anytime within the 1st year after closing.
• The AHS New Construction Home Warranty picks up after the one-year builder warranties expire.
• This coverage last for years 2 - 5 for a total of 4 years of home warranty coverage
on the new home.
• Coverage can be transferred to a new homeowner if the home is sold within years 2-5.
• Coverage can be renewed at the end of the 5th year in yearly increments.
So far, signs point to 2016 being a big year for new construction. See how we can help make it a big year for you, too. Learn how to put the New Construction Home Warranty
from AHS to work for you in 2016.Sources:
• Home Buying InstituteNext
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