It was a surprise year of growth for homebuilders in 2020, but that could be constrained by higher lumber costs, regulatory issues and a shortage of available lots, according to the National Association of Homebuilders.
The comments came from Dr. Robert Dietz, the chief economist and senior vice president for economics and policy for the National Association of Home Builders (NAHB), who spoke at a recent virtual summit held by Florida Realtors.
The NAHB expects economic growth to accelerate over the course of the year, as more of the population receives COVID-19 vaccinations, Dietz said in a press release.
“The new-home construction industry will grow in 2021, but at a lower rate, especially as interest rates will trend higher with the recovery, thanks to aggressive action by the Federal Reserve,” he said. “Housing affordability will be key-we risk pricing households out of the market due to rising interest rates and higher construction costs.”
This affects entry-level homebuyers looking to raise families in the suburban areas. Older millennial homebuyers will be able to afford housing more readily. However, Dietz noted that Florida showed strong growth in new construction last year, where building permits in the state were up 30% year over year in 2020.
Economists also discussed migration trends in Florida that have accelerated in 2020 because of the pandemic. Some of the influx comes from retirees and those who are now working remotely. Corporate relocations to Florida are also on the rise.