New home construction surges 50% in Tampa area
More Tampa Bay area homebuilders are swinging hammers again as the improving economy helped boost new home construction by nearly 50 percent in the first quarter of this year.
To be sure, that's starting from a low level, and new housing starts are still far short of where they were in the mid-2000s. Still, the industry already is undergoing a labor shortage, and it's projecting a shortage of developable lots as early as next year.
“I do think there's a lot of pent-up demand, and the fact that interest rates are low, that has a lot to do with it,” said Jennifer Doerfel, executive vice president of the Tampa Bay Builders Association.
On Thursday, housing research and consulting firm Metrostudy announced that builders started on 1,480 single-family homes in the Tampa Bay area in the first quarter of this year. That's up 46.2 percent over the 1,012 units they started on during the same quarter last year.
With the strong first quarter, Metrostudy had to revise its estimates for the full 2013 calendar year and now expects builders to start on 5,700 to 6,500 new homes over the year. That range would be at least an 11 percent increase and up to a 27 percent jump over last year.
Nationally, the housing data was more mixed. The U.S. Commerce Department on Thursday released new housing starts for April, showing a 2.1 percent decline in new single-family home starts from March. However, applications for building permits and builder confidence were up.
Mortgage rates rose slightly this week to 3.51 percent for a 30-year loan, up from 3.42 percent the previous week, mortgage buyer Freddie Mac said.
Locally, the growth is starting to cause some growing pains in the housing industry. For months, builders have complained of a shortage of skilled laborers.
So many construction workers lost their jobs during the housing crash that the industry now is trying to lure them back. The construction industry employed more than 95,000 people in the Tampa region in 2006 and today employs about 55,000.
Meanwhile, developed lots are becoming scarcer. Hillsborough County, for example, has a 24.4-month supply of developed lots, considered at equilibrium.
However, “Because lot development is not keeping up with the new starts demand, lot supply could drop below an equilibrium level by mid-2014,” Tony Polito, a Metrostudy official in Tampa, said in a news release.
Bill Eshenbaugh, a prominent land broker, said Standard Pacific Homes has aggressively bought up land in northern Hillsborough and southern Pasco counties lately for homes. It paid nearly $25 million for 675 acres in Wesley Chapel late last year, a substantial price but still far shy of the huge premiums builders were paying eight years ago.
The improvement in the new housing market looks fairly modest compared with the mid-2000s. Where builders started on 1,480 single-family homes over the past quarter, during some quarters in the mid-2000s they were starting on more than 6,000.