Homebuilding boom is building in Oklahoma City area
Homebuilders are building up a boom this summer, come the coronavirus or high water.
And new houses in the COVID-19 era are different. Buyers want double home offices. Outdoor living areas, already in demand, are more popular than ever. "Healthy" homes are moving into the mainstream.
Home starts hit 665 in July, the most since August 2013, when the market was hitting its stride coming out of the Great Recession, according to Norman-based Dharma Inc.'s Builder Report.
That was 47.8% more than the month before, and 55.7% more than in July 2019, Dharma reported.
Through July, builders took permits to build 3,351 homes, an increase of 14.1% compared with the first seven months of 2019, according to Builder Report, which tracks construction in Oklahoma City, unincorporated Oklahoma County, Bethany, Blanchard, Choctaw, Edmond, Midwest City, Moore, Mustang, Newcastle, Noble, Norman, Shawnee and Yukon.
"We are amazed at how heated up the OKC and U.S. real estate market has become during this COVID pandemic," said Caleb McCaleb, owner of McCaleb Homes in Edmond. "Everyone thought that the market was going to have a deep recession in real estate when everything started closing down. We are finding that because of the historic low mortgage interest rates, below 3%, the market has soared."
The Federal Reserve helped create "unsustainable low rates" to save and stimulate the economy, he said. In housing at least, it's working.
The low inventory of finished houses for sale has builders rushing to meet demand. Across the metro area, the supply of homes listed with Realtors slipped to 1.7 months in June, down from 1.8 months in May, according to the Oklahoma City Metro Association of Realtors. The association will have July statistics out next week.
"McCaleb Homes feels very blessed in having a record year in 2020," McCaleb said. "We are just calling it. 'Riding The Wave.'" The number of existing homes on the market for sale is at a 20-year low in OKC. Many existing-home sellers have pulled their homes off the market because of possible COVID exposure from unknown home (shoppers and lookers.) And, a lot of the buyers are saying they are afraid to go into occupied homes for sale because of possible COVID exposure.
"New homes seem to be filling the gap because people feel there is no risk in seeing them and buying them since they are vacant and have never been occupied."
Also because of the coronavirus, more people are buying houses without seeing them in person. A recent Redfin survey showed that 45% of respondents did so in the past year, presumably relying on video, online open houses and other digital innovations. The percentage is expected to grow.
New-home buyers aren't interested in just any new house, McCaleb said.
"We are seeing a huge demand for sound-insulated, double-office homes since the work-at-home economy looks to remain intact for the foreseeable future. There seems to always be a loud Zoom call spouse. We are also experiencing a surge in demand for outdoor living spaces where people can social distance with their friends and families but still have a sense of community."
More than 60% of potential homebuyers responding to a Realtor.com survey said that working at home is changing what they want in a house, as well as desired location.
"The ability to work remotely is expanding home shoppers' geographic options and driving their motivation to buy, even if it means a longer commute, at least in the short term," Realtor.com senior economist George Ratiu said in The Dallas Morning News. "Although it's too early to tell what long-term impact the COVID-era of remote work will have on housing, it's clear that the pandemic is shaping how people live and work under the same roof."
Homes By Taber's "healthy home technology" is getting more attention because of the coronavirus, said Lindsay Haltom, director of marketing for the Oklahoma City-based builder, which is just starting a new section of its gated Highgarden neighborhood, The Woods at Highgarden, in Edmond on the east side of N Douglas Boulevard between Coffee Creek and Sorghum Mill roads.
Haltom said the package includes a MERV-13 air-filtration system, low-VOC paints and “stovetop ventilation through the roof.” MERV stands for Minimum Efficiency Reporting Value, a measurement of the effectiveness of air filters from 1 to 16, the higher the value the more effective.
The "healthy home" features are part of a package of upgrades valued at $80,000 that is standard in Homes By Taber's houses, she said this week in an article on ProBuilder.com, the digital version of Professional Builder magazine, available at https://www.probuilder.com/breathe-easier-healthy-homes-go-mainstream.
Caution surrounding COVID-19 "has homeowners spending more time at home" and has many of them "reevaluating their living spaces," Haltom said.
McCaleb pointed out that building booms do have drawbacks.
"Every builder in Oklahoma City that I know is extremely busy. The problem is the shortage of building material supplies because of manufacturing limitations and labor limitations in the market now," McCaleb said. "The cost of lumber is the biggest problem in the short term right now. Suppliers are talking 20 to 40% increases in the price of basic framing lumber."