On a national level, Lawrence Yun, chief economist for the National Association of Realtors, said he viewed 2012 as a turnaround year. In comments he made with the release of his 2013 forecast, he said the industry was starting to come around last year "after four very, very tough years." He estimated sales rose about 10 percent last year, and he predicted an additional 5 percent growth this year -- a slower rate, but growth nonetheless.
Yun mentioned the threat posed by acute shortages of inventory in some metro areas. In the worst-case scenario, he said, a shortage drives up prices at a rate that far exceeds income growth, a disparity he called "not healthy for the country."
The economist said the real estate market last year benefited from four positive trends -- job creation, rising rents, household formation and low interest rates -- and he expects those trends to continue, laying the groundwork for another good year of sales.
New-home construction is another significant element of the residential market. John Manns, vice president of sales and marketing for Marrano Homes, said Marrano had an exceptionally strong October-through-December quarter. Customers signed 16 deals last month alone. "I've never seen a December like this in my career," he said.
The people signing those deals, he said, are planning for spring delivery of their homes. Manns sees this activity as a sign of consumer confidence. "People aren't afraid to sell their homes. They aren't afraid to put their homes on the market."
Marrano's new activity spans the housing spectrum, from townhomes to single-family homes to high-end properties, Manns said. For instance, five customers signed deals in December for the upscale Greythorne patio home development in Amherst. "These are people who don't do things unless their investments in stocks and things are good."
Christopher Tucker, the new president of the Buffalo Niagara Builders Association, also saw more activity than usual from customers in December and January, a sign of increased confidence.
Joseph McIvor, executive director of the BNBA, said his group's members have learned to look for ways to generate more business to manage their growth.
"We're still dealing with coming out of the recession that didn't hit Western New York and Buffalo as hard as other parts of the country, but the national publicity put a pall on everybody," McIvor said.
"I think in our industry, you've got to be concerned with diversifying your company, because it's not like we're a boom city and there's going to be a tremendous amount of growth moving forward," he said. "Every other house you look at in Western New York is over 50 years old, so you're probably doing remodeling, you may be doing some light commercial, you may be doing multifamily [housing]. ... All of those issues are, how do you survive in an industry that has so many challenges against it?"
The Horizons Home Show, the industry showcase that was revived in 2012 following a one-year hiatus, will be back for a 2013 edition. McIvor said builders were pleased with the turnout for the show at Spaulding Greens in Clarence, a town which is home to several emerging residential projects.
While BNBA leaders were still finalizing their plans this month, they were talking about hosting a two-site show, potentially at Spaulding Greens and Emma Woods in East Amherst. The expanded Horizons format has not been used in a number of years.
Distributed by MCT Information Services
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