Growing Consumer Confidence Boosts New Home Construction

Ian Rieger of Rieger Homes was interviewed recently for the following article published in the Times Herald Record on Sunday, April 27, 2014. Rieger Homes, the builder of choice in the Hudson Valley for over 50 years, has new homes available in Sugar Loaf, Village of Washingtonville, Town of Marlborough, Town of Poughkeepsie and Hopewell Junction, NY. Contact us to arrange a visit and learn more about Rieger Homes’ Energy Efficient, High Performance Homes.

Market heating up for home builders

Some putting up new units on speculation

By James Walsh
Times Herald-Record, Published: 2:00 AM – 04/27/14

“The economy's gotten better,” says Ian Rieger, seen at a new building site in the Rieger Homes subdivision in Sugar Loaf. “Plus, there's a pent-up demand.”ALLYSE PULLIAM/For the Times Herald-Record

Builders of new homes in the mid-Hudson are rolling into the construction season with growing optimism, some going so far as to build houses on speculation, a chance rarely taken since the real estate meltdown in 2008.
Their confidence is buoyed by continuing low interest rates, a small inventory of newly constructed houses, and what some builders perceive as growing consumer confidence.
The bright outlook follows a frigid winter that was particularly brutal for residential developers. Buyer traffic was practically nil as the weather kept people away, and freezing weather brought work to a halt. Now, as the sun finally warms the Hudson Valley and Catskills, some builders find themselves busier than they’ve been in years.
“The economy’s gotten better,” said Ian Rieger of Rieger Homes Inc. “Plus, there’s a pent-up demand. It’s like a pressure cooker. It has a lot more oomph behind it now.”
Rieger’s looking to take some of that pressure off with his eight-lot Fox Hill subdivision in Sugar Loaf. Framers were finishing up last week on a 2,300-square-foot spec house. The crew will soon be hammering away on another house that sold pre-construction. Rieger said multiple buyer prospects surfaced in recent weeks for houses priced between about $400,000 and $500,000. They measure between 2,300 and about 3,200 square feet.
“And we haven’t even started our marketing yet,” Rieger said. “It’s all part of the pent-up demand.”
Jonathan Shafran, president of the Hudson Valley Builders and Remodelers Association, said the industry has taken a positive turn.
“I’m hearing from subcontractors that a lot of guys are real busy,” Shafran said.
He’s also building a house on speculation at his Eagle Crest development in Sugar Loaf.
Laurel Sweeney, associate broker at Prudential Nutshell Realty in Stone Ridge, said building a spec house makes sense from a sales perspective.
“Most people cannot envision a constructed house from a floor plan or schematic,” Sweeney said. “It is in a builder’s best interest to build on spec, so potential buyers can see what they’re getting.”
The Ulster Board of Realtors’ multiple listing service showcases 75 new-construction houses. Eight of those have accepted offers and are in various stages of construction, Sweeney said.
“Generally speaking,” Sweeney said, “the availability of good-quality newly constructed homes does not meet demand.”
The Lanwin Group of Hopewell, N.J., has two spec houses going up, one for $450,800 in the Town of Newburgh’s Forest Ridge, and another priced at $409,000 in the Mailler Oaks subdivision in Cornwall.
“We are very optimistic,” said Philip Evans, Lanwin’s managing partner. “We think there will be a slow but steady pickup of new homes being sold in the area.”
Evans said spec building lets people see the quality of the construction.
Lanwin is breaking ground for five houses at the 48-lot Forest Ridge within the next two weeks. Prices in the subdivision run from the mid-$300,000s to the mid-$400,000s.
Michael Walker’s 18-lot Woodmere at Goshen has just two lots left for homes priced from about $370,000 to a bit over $500,000. He’s planning a subdivision of 75 clustered lots next spring on about 260 acres in Goshen.
A model house that opened in Woodmere in January sold within a month. Walker also cited demand outstripping a small supply of new houses.
Mal Meyerson of Malmark Construction Corp. has found his geothermal packages a draw for buyers. His 12-lot Woodland Lake Estates in the Town of Mamakating has just five lots left after opening a year ago. There have been enough buyer inquiries lately to prompt building driveways to the remaining lots.
“It’s like someone flicked a light switch,” Meyerson said.
Likewise, Shafran, the builder association president, said his Eagle Crest project has been “swamped” with inquiries from prospective buyers.
“It’s been a long time coming,” he said. “It’s probably been seven years since I’ve been this busy.”
jwalsh@th-record.com

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