November 26, 2014

Promoting new homeownership to strengthen economy

New home construction is a good indicator that the economy is getting better. Andy Inman is with T.Wall Properties in Madison. “What people get out of owning a home, having a home, raising a family in a home, that’s one component of it. The other component of it is job creation. The statistics are basically for every 1,000 homes built there are 3,000 full time jobs created.”

That means more tax revenue for the state. Inman says $15 million in taxes is generated for every 1,000 homes built.

Wisconsin Builders Association Executive Director Jerry Deschane says the market is turning around. “What’s been happening is you’ve been rapidly reducing the inventory of what’s available out there, which, from a homebuilder’s perspective, there are fewer new homes on the market now than any time since the 1950s. You know, if you want something that’s got that new home smell, chances are it’s not out there. You’re gonna have to have it built.”

Wisconsin existing home sales increased 3 percent in March, which is the 21st straight month of sales growth, according to the Wisconsin Realtors Association.

Deschane says there are still a lot of people who can afford to be in the market but are still holding back. Governor Scott Walker has proclaimed April as New Homes Month to highlight the economic impact and to recognize the importance a home can have to a family. Mortgage rates are currently at all time lows: 3.47 percent for a 30 year mortgage; 2.71 for a 15-year mortgage, according to bankrate.com.

According to the WRA, median home prices grew 9.7 percent to $134,900 in March, compared to the same period last year.