New home construction rising in York amid low inventory
High demand for homes in York County is combining with low inventory to lead to an increase in new home construction.
In April, 463 homes were sold in the county, according to a report from the Realtors Association of York and Adams Counties.
That figure is the exact same as the number sold in March, but it represents a 3 percent decrease from the number sold in April 2016.
The slight drop breaks a streak of 27 consecutive months of year-over-year home-sales growth in the county, according to RAYAC reports.
Deborah Goodling, RAYAC president, said demand remains high, but there aren't enough homes on the market. She pointed out that 13 percent fewer homes are for sale in York and Adams counties when compared to last year.
With fewer available homes to choose from, potential buyers appear to be turning to home construction.
Ted Ventre, president of the York Builders Association, said home construction is up about 13 percent compared with last year. That figure is determined by looking at the number of permits granted by municipalities, he said.
Jeff Rutt, CEO of Lancaster-based Keystone Custom Homes, said his business has seen a significant increase in sales since the beginning of the year.
"We're seeing a return of Maryland traffic pushing up into York," he said.
Keystone builds about 10 percent of its new homes on a speculative basis — meaning constructed without a contracted buyer — but the majority of new homes are custom-made for buyers, Rutt said.
"We like the idea of building someone's dream home the way they want," he said.
Ventre said he's not seeing a large number of new homes constructed on a speculative basis because builders have been burned in the past, which is part of what led to a nationwide housing bubble and subsequent financial recession in 2008.
"Never say never," Ventre said, when asked whether he believed speculative homes would ever be built on a widespread basis again, "but a lot of people learned a really hard lesson and are going to be really cautious."
That caution will ultimately lead to "a more realistic market," Ventre added.
Goodling said the local housing market is becoming more stable ahead of the summer months, which historically lead to a higher sales volume.
Overall, 1,590 homes have been sold this year in the county. That figure is 4 percent higher than at this point in 2016.
Aside from an increase in new home construction, high demand and low inventory also are leading to an increase in sale prices.
The median home sale price in York in April was $161,500, which is 4 percent higher than in April 2016.