Suburban and Exubran Communities See The Fastest Home Building Activity

 

The pandemic has not only changed buyers' perspectives on what they want in a home but also where they want their home to be located. More and more buyers are searching in the suburbs away from crowded urban areas. Surprisingly the multifamily sector is seeing more new home starts in the suburbs and lower-cost markets.

According to the NAHB's current Home Building Geography Index (HBGI) multifamily construction saw double-digit percentage gains in suburban areas in the second quarter of 2021. Large metro areas saw a decline in multifamily new starts. Multifamily residential construction rose 14.3% in small metro urban cores and 25.5% in small metro suburban areas while large metro core areas saw a 0.5% decline.

“The trend of construction shifting from high-density metro areas to more affordable regions, which accelerated at the beginning of the pandemic early last year, appears to be continuing,” said NAHB Chairman Chuck Fowke. “Lower land and labor costs, and lower regulatory burdens in suburban and exurban markets make it more appealing to build in these communities. And workers are increasingly flocking to these areas due to expanded teleworking practices and lower housing costs.”

If you are in the market to purchase a home, now is the time. Get in touch with a Realtor in your local community who can help you with the process.

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A Positive Employment Report for August

The NAHB Eye on Housing reported an increase in nonfarm payroll employment from July to August this year. Nonfarm payroll employment increased to 31 states in August with 235,000. This was at a slower rate than seen in July with an increase of 1,053,000.

August saw a strong increase on a month-over-month basis in California where 104,300 jobs were created, in Texas 39,300 and New York 23,500 were created. Nineteen of the states and the District of Columbia saw a decline with a loss of 64,100 jobs.

Out of the 48 states which reported construction sector job information, 24 of those states saw an increase in both residential and non-residential construction jobs. Colorado, South Dakota and Utah saw no changes while Nevada added 3,000 construction jobs. There was a 4.4% increase in New Hampshire but a 3.7% in Kansas between July and August.

The construction sector jobs also saw an increase of 2.7% by 193,000 jobs on a year-over-year basis. California again came in at the top with 35,900 construction sector jobs while New York lost the most at 11,700 jobs. In percentage comparisons, Rhode Island had the highest growth at 13.9 which Wyoming at the worst at a decline of 7.7%.

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Hilcorp Might Purchase Phillips 66 Refinery in Belle Chasse

This can be both good news and bad news for Belle Chasse and Plaquemines Parish. Phillips 66, which is based out of Houston wants to sell its Alliance Refinery in Belle Chasse. The good news is that Hilcorp Energy Co. is considering purchasing the refinery but the bad news is over 850 workers and contractors who are employed at the current refinery will be out of a job.

Hilcorp would have to shut down Alliance to be able to convert the refinery which is located on the lower Mississippi River into an oil export terminal. Hilcorp feels the refinery is a possibility to be incorporated into Hilcorp's growth strategy. In 2020 the company acquired BP PLC's in all of Alaska adding it to the already huge Hilcorp Alaska private oil and gas operator.

Hilcorp is also based out of Houston and was founded in 1989. It is the largest privately-owned oil and natural gas producer in the country. They provide oil, petrol and natural gas.

The Alliance Refinery is about 25 miles south of New Orleans. The refinery gets its crude oil from the Gulf of Mexico by pipeline and U.S. tight oil by barge. Most of the refined products from the refinery are distributed around the eastern United States. It is distributed through the major common-carrier pipelines and by barge.

The refinery, built in 1971, sits on 2,400 acres in Belle Chasse and has a capacity to process 255,600 barrels of crude oil each day, most of which is refined into gasoline. This sale could see a potential of $500 million.

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Patios Are Now Built on Over Half of New Homes

The National Association of Home Builders reported that over 60% of new homes built in 2020 have patios. This is the first time since the Census Bureau's 2005 survey that patios have been on over 50% of new homes. There were around 990,000 single-family homes started in 2020 and 61.4% of these homes had patios.

The shares of new homes with patios started to dip in 2007 from 50.4% in 2006 to 48.8% in 2007. The shares did not begin on the upwards trend again until 2011. The big increase from 2019 at 59.6% to 2020 at 61.4% was due to buyers' change in desires in what they want in a home. The pandemic caused us to rethink what is important when it comes to a home. Having a private place to spend outdoors became very important.

The nine US Census divisions also saw a drastic change across the board. Surprisingly the Mountain division was the highest at 74%, next was West South Central at 73%, the South Atlantic at 67%, and the Pacific at 59% all at over 50%. The remaining regions were all under 50% with the East North Central coming in at 47%, the West North Central and East South Central at 41%, New England at 21% and Middle Atlantic at 19%.

As for the construction and size of patios, those also differ. The majority of the patios across the board are constructed of poured concrete, followed closely by concrete and brick pavers. The average size across the board for a patio on a new single-family home was reported to be about 278 square feet. The largest were over 350 square feet in the Mid Atlantic, East North Central and Pacific divisions. The smallest which were under 200 square feet were found in the East South Central division.

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