New home sales improved in March at the fastest single-month rate in 47 years, according to a government report released Friday, as buyers snatched up properties ahead of the tax credit that’s set to expire.
New-home sales rose 26.9% to a seasonally adjusted annual rate of 411,000 last month, compared to an upwardly revised annual rate of 324,000 in February, the Census Bureau said. The gain snapped a four-month streak of declines.

The big question is: What happens after the tax credit expires?

The Census Bureau data followed a report from the National Association of Realtors on Thursday that showed existing home sales soared nearly 7% in March, as new homebuyers raced to buy up properties before a tax credit expires on April 30.

“It’s obvious that homebuyers are rushing in to take advantage of the tax credit that’s set to expire,” said Robert Dye, senior economist for PNC Financial Services.

We think the key to that question is SUPPLY!

The Census Bureau estimated that 228,000 new homes hit the market in March. At the current sales rate, it would take 6.7 months to sell through that inventory, down sharply from an estimated 9.2 months of inventory in February.

With supply trimmed (due to stepped up sales from the tax credit and a reduction in the number of new homes built), we continue to believe that prices have firmed and that buyers will increasingly be confident that the cost of waiting is higher than the cost of acting. That won’t cause the market to run higher, but it bodes well for a return to normal.

You can read more about this here.

For more information, see Richmond VA New Homes.

A recent article in Bizsense bounces between these two extremes.

One the one hand:

New home construction is still down 34 percent from 2008 levels in Chesterfield. And overall activity (commercial, new homes and renovations) is down 50 percent from the first quarter of 2008, when Chesterfield issued 1,566 commercial and residential permits totaling $118.1 million.

In Henrico during the first quarter, new single-family home permits dropped 48 percent from 288 homes in 2008. Total permits fell 33 percent, and their total value fell 48 percent.

On the other:

Bud Ohly, president of Eagle Construction, said they have 11 homes under construction there, with permits approved for more.

“Things are a lot better than they were six months ago,” Ohly said. At the time, construction had halted, and the master developer Unicorp was straddled with liens and lawsuits.

In the first three months of the year, he said, they have sold eight units, which was everything they had available. Of the homes under construction, he said they are building a few of them on spec.

Our take is that if you wait until everything is ‘better’, you’ll have missed a MAJOR opportunity provided by today’s market.

You can read more about this here.

For more information, see Richmond VA New Homes.

The Google Fiber for Communities Project is an experiment to build an ultra-high speed broadband network that will deliver internet speeds more than 100 times faster than what most Americans have access to today. The planned network will offer speeds over one gigabit per second in the fiber-to-the-home connections. Google plans to offer service at a competitive price and an open network.

For those not-so-technical, getting fiber-to-the-home would enable some amazing applications:

Imagine sitting in a rural health clinic, streaming three-dimensional medical imaging over the web, and discussing a unique condition with a specialist in New York. Or downloading a high-definition, full-length feature film in less than five minutes. Or collaborating with classmates around the world while watching live 3D video of a university lecture. Universal, ultra high-speed Internet access will make all this, and more possible.

What can you do to enhance Richmond’s chances of snagging this plum?

“One of the deciding factors in Google’s decision will be community support and it is imperative that we enlist everyone we can to join our application effort. Residents can join us on our social media sites and show Google that Richmond is the city that will embrace their project and help make it a success,” said Mayor Jones.

You can read more about the potential project here, and make sure you go here to show your support by nominating Richmond, VA.

Do you part…nominate Richmond!

For more information, see Richmond VA New Homes.

From a housing standpoint, for the most part, we just stopped. We all stopped buying, selling, moving, lending or pretty much anything else to do with real estate.
When we tried to sell, the offers that we got (if we got one at all) were very low with tons of strings attached. If it was a contingent contract, it was very unlikely to ever become non-contingent. The lenders took away almost all of the loan programs and on top of that, sought out reasons not to do loans that did comply, even for the most credit worthy of clients. It was very frustrating.

But as we enter into 2010, something has been happening behind the scenes that no one is really discussing. Everyday that we all spend not in our graves is a day we spend moving towards being incorrectly housed. Each and every day, there are babies born and children growing up and leaving the nest, people getting married or divorced, workers being transferred, promoted or taking a new job…sometimes better and sometimes worse. Likewise, each and every day we all get a little older meaning that the stairs we climb or the drive to medical care all becomes more important.

The recession did not stop these things from happening. It just prevented all of us from doing anything about it. Our financial clock stopped but our housing clock did not.

As we move forward, signs of economic life emerge, which makes us all feel that we can feel better/safer/more confident about our decisions. From a housing standpoint, we are coming into a market with more people in spaces that do not fit them than ever before…..and that is a good thing for housing.

I am not.

While mortgage qualification is always a concern, the even larger concern in my mind, is whether or not a buyer is qualified to BUILD the home.

Huh?

Building a new home (or more correctly spoken, having one built for you) is hard work. It is time consuming. It is frustrating. It is confusing. It is emotional. It brings out the worst in many people. It brings a level of uncertainty and uneasiness to your everyday life. It adds a layer of stress and work on top of our already stressful and overworked lives. It is tough.

When buyers begin to talk about ‘maybe we should just build a new home,’ I will ask them what makes them qualified to build one. The following answers do not count:

“My friends just did”
“Well we go to a lot of open houses and we know what we want.”
“We live in a house now and we know what we need.”
“My parents did it a few times and they can help.”
“My (father/mother/cousin/aunt) is an engineer.”

If these are the reasons you think you are qualified to build a home….don’t do it. You are far from qualified.

First and foremost, you need to understand what you are trying to accomplish. If there is a particular need that is unique to your situation, then maybe building is the only way you can get what you need. Examples would be health issues or family issues or even work issues. The need for ADA compliance or an extra bath for a parent that may live with you or an expanded home office all could be needs that are not easily addressed in the resale market.

Another good reason for building is if you work for a builder and get the “I work for a builder” discount. If you can buy the home at a wholesale price, it is not a bad idea.

Sometimes, the area in which you wish to live may dictate that you build. If a new school is the draw and there is not a existing inventory of homes to choose from, building may be your only option. Likewise, rural areas usually have lower inventories and older homes. Buying a piece of land and building a home, may be the only way to get what you truly need.

With those exceptions, make sure that if you wish to build a home, you are doing it for the right reasons. It is a tough process and a time consuming one. Make sure you are ready.