Permits for new-home construction in the Augusta area are up by 132 from the end of July compared with the end of July 2011, according to data from Construction Week, which tracks the metro area.
Nationwide, new-home starts rose by 6.9 percent to a seasonally adjusted annual rate of 760,000 units in June, according to recently released figures from Housing and Urban Development and the U.S. Census Bureau. That is the fastest pace of new home construction since October 2008.
Phil Corley, the vice president of marketing for Crown Communities, which has built Augusta communities including Sage Creek and Magnolia Valley, attributes the increase in new homes to steadied consumer confidence.
“Consumer confidence is starting to pick up a little bit, and that means a lot,” he said.
Profit margins are thinner than they have been in the past, Corley said, but it’s still a good time for the new home industry.
“We’ve been able to maintain a good balance of value and profit,” he said.
Doug Reese, the senior vice president and general manager for Blanchard and Calhoun, has been in real estate for more than 20 years and said he has never seen new-home sales as high as they are now.
According to Reese, more than 50 percent of the real estate closings over the past year were newly constructed homes, a far cry from the 15 to 20 percent he is used to seeing.
Though myriad factors contribute to the national uptick in home construction, Reese said Augusta owes its growth to steady employers such as Fort Gordon and Plant Vogtle. They move people to the area, pay good wages and add stability to the economy, he said.
“Industry is driving people here,” he said. “We’re fortunate that we have that.”
According to permit data, there have been 1,362 residential construction permits pulled for Richmond, Columbia and Aiken counties. There have been 172 housing starts in Richmond County this year, 53 more than last year at this time. Builders have been putting up 848 homes in Columbia County this year, 144 more than a year ago. Aiken, however, is down 65 from last year.
Most buyers would take a new home over a previously lived-in home, Reese said, and low interest rates and reasonable prices in the Augusta market make it easy to buy new.
“New construction is a bargain, and labor and materials are at an all-time low,” he said. “With cheap money and affordable cost of labor and materials, why not?”
According to the National Association of Home Builders, the growth in new home sales is the result of an increase in serious buyers to the market and higher consumer confidence.
“This is one more piece of evidence that housing is starting to take back its traditional role of leading the nation out of recession, and tracks with our forecast for continued improvement in new construction through the end of this year,” said the association’s chief economist, David Crowe. “While many challenges continue to weigh down the housing recovery – including those related to builders’ and buyers’ access to credit, poor appraisals and the number of distressed properties in certain markets – production of single-family homes is now the strongest it has been since 2010 due to rising consumer demand brought on by improving market conditions.”