April 22nd, 2021
When you drive down Main Street USA it’s hard not to think back about how it all began.
During the 1950’s the overall economy grew by 37%. This boom was primarily powered by the post WWII troops coming home and looking to start the next part of their lives post service. Other factors, including affordable education and increased productivity due to technological advances, were also key drivers. In addition – the rise in automotive ownership made cities more assessable from afar.
Essentially, Americans wanted their space and to start a new chapter in their lives. Families were growing, towns were thriving, and the need for housing was strong.
The early 2020’s are, in their own way, roaring just like a hundred years ago. Despite the Pandemic housing demand continues to exceed supply as people move further out from larger cities. It’s not just single-family homes being built but also higher density dwellings. In fact – Market Watch notes that building permits for duplexes, triplexes and quadplexes have surged 25.5% year over year. Regions such as the Midwest that have traditionally been less populated than their coastal counterparts are seeing the most growth, notably in Colorado and Texas.
According to the Wall Street Journal construction began on 1.74 million homes across the US in March 2020 – the highest level since July 2006.
History continues to further repeat itself – technological advances are increasing productivity (notably around telecommuting) and transportation infrastructure continues to expand. Like post WWII, growth is fueled from a new generation of buyers as Millennials have now reached the point in their generation where home ownership is desirable to them.
What presents an added wrinkle for this boom? Current homeowners that want to take that step to own something newer or bigger.
This is where supply becomes crunched; there are not enough homes to meet demand for both competing groups.
Rather than wait for all new homes to be constructed we are seeing a spike in demand for houses that are a hundred years old or more. A recent article in the NY Post states that demand for houses in the New York Tri State Area that are a hundred years old or more rose 16% in 2020. Consumers are even willing to move to regions with rapid growth where prices are more affordable. Forbes recently gave guidance that the South and Midwest tend to offer the most value; and according to Insider.com the top ten cities with the fastest growth are:
- Ft. Myer, FL
- Bend, OR
- Meridian, ID
- Milpitas, CA
- Enterprise, NV
- Frisco, TX
- Town ‘n’ Country, FL
- Round Rock, TX
- Mount Pleasant, SC
- Nampa, ID
Where does that put someone like Builders Capital? Right in the thick of history.
We have the power and the ability to fund projects across the USA with nearly $2 Billion dollars in working capital. Our technological innovations allow us to lend quickly, supporting the wave of growth across the country. We want to work along side you as you continue to build during this generation’s housing boom. It’s going to take a while for supply to meet demand, but Builders Capital is built for the long haul.
Whether it is rebuilding a piece of yesterday’s main street, or creating the new main street of tomorrow, Builders Capital is poised to be with you each step of the way. Want to learn more about us? You can! Simply contact us for any of your questions.
About Builders Capital
Builders Capital is one of the nation’s largest private construction lenders, offering innovative financing solutions to a wide spectrum of developers and homebuilders, from bridge, fix-and-flip and ground-up construction, to development and attached housing. The Company maintains offices in Seattle and Puyallup, Washington, with sales offices in Boise, Denver, Colorado Springs, Vancouver, Phoenix and Orlando. Builders Capital’s management team brings to the business over 100 years of expertise in residential construction lending, home building, real estate development, and loan servicing.