Carpenter frames home in Plymouth
MINNEAPOLIS -- Homebuilders in the U.S. are describing themselves as "optimistic" for the first time in seven years.
The monthly survey, conducted by the National Association of Home Builders and Wells Fargo bank, found that an increasing number of homebuilders describe their outlook on sales as optimistic. On the survey's index scale, the "builder sentiment index" was at 52.
In May it was at 44, so business is clearly picking up for those involved in new home construction. The last time that survey topped the 50 percent mark was in April of 2006, before the Great Recession.
That positive vibe is definitely being felt here in Minnesota, according to David Siegel of the Builders Association of the Twin Cities.
"Sales of existing homes are rising rather quickly and they're not staying on the market very long," Siegel told KARE.
"So people are looking at building new, both in new tract developments and in tear-down situations in great existing neighborhoods."
He said low interest rates are also helping the new home market, but that lenders are more cautious when it comes to extending credit than they were during the housing boom.
"The banks and mortgage lenders are being more selective this time around and that's why the size of the new developments is smaller than before the recession."
Custom-home builder Curt Swanson, based in Medina, said that business has definitely been on the upswing. He's hearing from buyers who've been thinking about a custom-built home for years, but were wary of the economy.
"Five to six years ago we were doing five or six homes a year. Now we're up close to 20, and that's quite a bit for a small custom builder," Swanson told KARE.
"Our employees, our subcontractors and suppliers are really enjoying the fact they've got work again and can provide for their families."
Swanson said that customers are taking a more practical approach than they did during the boom days when it comes to space.
"During the housing boom they splurged sometimes and built rooms just in case they might need it in the future," Swanson explained.
"Now they're deciding, 'We don't want to build rooms we're not going to use in the near future.' So we're definitely building different, and building smarter."
Today's buyers are also looking for low maintenance exteriors, but still want materials that look authentic, Swanson said.
To strike that balance he'll use products like James Hardie shake shingles that mimic cedar but can go longer without repainting. He'll also use LP Smart lapboards instead of wood lap or vinyl siding.
"That's a product that's made up in Two Harbors, Minn., so that's always nice."
Customers are looking for floor plans that have a lot of flow, for instance, a wide open space that includes a kitchen to the great room. And many buyers are seeking an indoor sport court, often behind the garage, with a 20-foot ceiling.
The home he's building in Edina features a window from the main level looking down on the court, so that parents can talk to their children.
"The kids can play year around," said.
"As you know in Minnesota we have six months -- at best -- of exterior playing, other than out in the snow."
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