Local homebuilders confident in 2010
Posted February 25, 2010 6:45 p.m. EST
Updated February 26, 2010 5:35 a.m. EST
Raleigh, N.C. — Sales of new homes dropped 11.2 percent in January, the U.S. Commerce Department reported Wednesday – the lowest level on records going back nearly a half century.
But local developers said they are trying to remain positive about what's to come this year, saying there are signs that the worst might have passed.
"We feel that 2009 was the bottom," said Warren Smith, president of the Homebuilders Association of Raleigh-Wake County. "Unfortunately, in 2010, we're going to see the results from the bottom."
Smith said one of the biggest problems in the Triangle is that too many homes that were built above the $500,000 price point before the economy's downturn. That left many builders sitting on inventory for more than a year, often ending in foreclosure.
"We are starting to see a little bit of a turnaround," he said. "I think a lot of these guys have now adjusted their business philosophies."
Much of the focus now appears to be on building new homes that cost less than $300,000, Smith said. New federal tax credits for home buyers are helping shape that direction.
"I think the incentives are making a difference in the lower price ranges," he said.
Although Smith and others believe things will be better in 2010, they said it will likely be another year before the market stabilizes.