On a near daily basis, Austin Marsland of Clayton, North Carolina, is fielding calls from other home builders and land developers seeking to buy a piece of his company’s land holdings in the Raleigh suburb.
“It’s a hard ‘no’ every time,” says Marsland, chief operating officer at RiverWild and its One27 Homes home building affiliate.
With overall housing demand in the Raleigh-Durham region still far outpacing the national average (up 82% in October, according to Zonda’s New Home Pending Sales Index, versus up 46% nationally), local residential real estate investors are hoarding what they have—and trying to bank more for the future.
The Raleigh-Durham real estate market also has been getting more attention than usual on a national scale after the 2021 Emerging Trends in Real Estate report published by Urban Land Institute and PwC ranked the Triangle region at No. 1 for overall real estate prospects, as well as No. 1 for home building prospects in 2021.
Going into 2021, will Triangle builders be able to keep up with both the demand and the hype?
The Zonda forecast for Raleigh-Durham shows new-home starts should still be able to grow 7% or more in 2021, but it will be a challenge for builders as the market’s housing lot inventory has been depleted to only 16 months of supply and could restrain future growth.
Resale inventory in the Triangle has been down 40% or more for much of the year, helping steer more buyer traffic toward new-home communities and driving up market share for new homes. Year-to-date contract sales are up 28%, according to a survey of local production builders, but the market’s availability of quick move-in homes is the lowest it’s been in four years.
Hampton Pitts, division president of Stanley Martin Homes’ Raleigh division, says the company has been trying to pace itself. “We passed our sales goal for this year in early November … and we’re writing contracts for the end of second quarter next year already. So, it looks like it’s going to be another good year.”
