New Home Construction Surges to 22%

The home construction industry is booming, with a 22% surge in new home starts since last year. This is good news for the economy, as the construction industry is a major driver of job growth.

New home construction attempts to meet the growing demand for housing. On the other hand, the housing market also benefits from increased activity. This is especially true in regions where population growth is high.

The increased supply of new homes helps keep prices affordable and accessible to a wider range of buyers.

So what could be the possible drivers or factors for this surge?

A combination of factors drives the rise in new home construction. This includes low-interest rates, strong consumer confidence, and improving economic conditions. Despite the pandemic, many Americans are still interested in buying a new home.

The demand for new homes will likely continue to grow in the months ahead. It might be a good idea to begin your search for a new home if you consider it.

However, home construction is not without challenges and frustrations. These challenges are especially evident during the recent pandemic.

Challenges Builders and Homeowners Face

Homebuilders across the country are struggling to keep up with the demand for new homes. The number of homes being built each year is far below the number of people looking to buy. This imbalanced demand and supply can lead to frustration and even desperation for potential homebuyers.

A variety of factors have caused a shortage of new homes. These factors include the high cost of land and construction materials, a lack of skilled laborers, and stringent building codes. As a result, home prices continue to rise. These high home prices make it increasingly difficult for young families and first-time buyers to enter the market.

Some experts predict that this situation will only worsen in the coming years as more and more baby boomers retire and downsize. Due to these developments, the current housing shortage is unlikely to be resolved anytime soon.

All of these factors have combined to lead to a scenario where both builders and buyers are feeling the pinch. Builders have experienced delays and cost overruns due to the difficulty in finding workers and materials.

Meanwhile, buyers are finding that they must either pay more than they would like or settle for a home that is not their first choice. Despite the challenges, both builders and buyers remain hopeful that the situation will improve in the months ahead.

Silver Lining Amidst Struggles

There may be a silver lining to all this. As the old saying goes, necessity is the mother of invention. And with the need for new housing at an all-time high, homebuilders are being forced to get creative. We’re seeing a resurgence of “tiny homes,” modular construction, and even 3D-printed homes. These new building techniques are not only more efficient and sustainable.

Despite the challenges, homebuilding is still a very lucrative industry. The average profit margin for builders is about 15%, which is quite high compared to other industries. So, there are plenty of reasons for builders to continue investing in new home construction, even amidst the current pandemic.

If home builders decide to invest in new home construction, you must protect yourself against risks.

Protection Against Risks

The construction industry presents a unique set of risks. Make sure you are covered against these risks with construction insurance. A new home is particularly dangerous due to the possibility of accidents occurring. Construction businesses can purchase insurance to help protect them from these risks.

There are a few different types of insurance that businesses in the construction industry should consider. The first is general liability insurance. This insurance protects businesses from any accidents or injuries that occur while working. It can also help protect them from any property damage that may arise.

Another type of insurance that businesses should consider is workers’ compensation insurance. This insurance covers medical expenses and lost wages for employees injured on the job. It can also help protect the business from any legal liability arising from these injuries.

Businesses in the construction industry should also consider purchasing commercial property insurance. This insurance protects businesses from any damage or losses to their property. This can include damage caused by fire, theft, or natural disasters.

By purchasing these types of insurance, businesses in the construction industry can protect themselves from a wide range of potential risks.

Conclusion

Homebuilders are feeling the pinch as the current housing shortage continues to worsen. However, there are still plenty of reasons for them to invest in new home construction. By purchasing insurance, businesses can protect themselves from a variety of risks.

About Daniels Insurance, Inc.

At Daniels Insurance, Inc., we have a unique understanding of the risks that businesses like yours face on a regular basis. With the backing of our comprehensive coverages and our dedication to customer service and quick claims resolution, your business will be fully protected. For more information, contact us today at (855) 565-7616.