New homes are being built, but not at the level and speed that was expected for them. That’s unfortunate, because it’s yet another indicator that the economy is still having problems. In the US’s Northern neighbor, Canada, housing starts are up sharply from where they were in 2009. There are also a few cities in the US where housing is starting to straighten itself out, but they are few and far between. Builders just aren’t that interested in creating new homes, because those homes will sit for far too long before they sell. Phoenix, Arizona even recently bulldozed an entire neighborhood of new homes because no one was going to buy them.
Seeing the Economy Improve
There are predictions, especially in big cities like Chicago, that housing will improve its numbers in 2011. Of course, that remains to be seen. The optimism is encouraging, though, and it may help people who are thinking about getting into the housing market move forward. If others see that investors are making a move, they’ll be more interested in doing the same, and that will contribute to an economic uptick that may start to pull the housing market back out of the doldrums it has been in for so long.
Any news of improvement is good news for the housing market, and that’s even more significant in the bigger cities where things have been bad for some time. Chicago, Phoenix, Miami, Los Angeles, and comparable cities have found that people just can’t afford to live there anymore. The houses were so expensive at the height of the bubble, but banks were lending. Now the houses have come down, but they’re still out of reach for most people because the banks aren’t lending as freely as they used to. It’s a conundrum that many people today are facing.