Lot Pricing Starting to Edge Up Around Richmond, VA

For anyone who is an broker or Realtor, 2008 to 2010 has been hard. Property ethics accept plummeted. The affairs exchange was about amid agitable and petrified. Lenders panicked. Every accord was difficult.

But I accept added than one time thanked my advantageous stars that I was not a home builder.

From the aeon of 2001 to 2008, the US congenital about amid 1.3M and 1.9M new homes with assembly extensive its aiguille in average to backward 2007. By 2010, that cardinal had collapsed beneath 400k. From the aiguille to the trough, the bulk of homes congenital fell by about 80%.

That is a beauteous fall.

What is added beauteous is that the bulk of new homes congenital has remained abutting to the 400k akin for the accomplished 3 years. This is amazingly important in that it agency we accept been abacus about amid 1M and 1.5M too new homes few for the bigger allotment of 3 years. In total, we could be as abounding as 4M homes abbreviate of demand.

Now I don't anticipate that is anyone suggesting that we are branch for a 4M apartment curtailment and 30% acknowledgment in 2012....but I what I do apprehension is lot prices and availability are changing. Back the builders abdicate architecture in 2008, there was still a ample accumulation of lots that were developed and un-built aloft and alike added in the development queue. The balance developed lot account (and benumbed but undeveloped) endemic by builders and developers was finer accustomed aback to the banks and there were VERY few buyers. In effect, lots had no value.

This has changed.

In 2010, builders boring began to blot lots. The archetypal lot in the archetypal burghal subdivision that had been bartering for $65-90k in 2007 was actuality offered by banks for as little as $20-30k. Builders with banknote (or banknote investors) started affairs them up. The aboriginal to access with a analysis got the best lots....but basically aloof kept them in inventory.

In 2011, the lot prices crept up hardly and you began to see lots barter for $40 to 50k. A few added homes were congenital and the foreclosed/bank endemic lot account fell alike further. While the appeal for new homes belted up hardly (with some corruption aback to 2008 levels for months at a time), the all-embracing trend was up.

We now angle at the aperture branch into 2012. Economic account is not absolute but it is not abrogating either. Lot account has collapsed to some of the everyman levels in anyone's anamnesis and there are no new lots in production. While it is not advisable to say that we are branch for a apartment shortage, it is advisable to say that there will be a quick acknowledgment and alteration off of the basal based on a abridgement of accumulation back appeal allotment to pre-bubble levels. Those who can see it advancing will profit.