According to a survey conducted by the National Association of Home Builders (NAHB), a shortage of buildable lots in the most desirable locations is preventing a more robust housing recovery.
"In our August 2013 survey, 59 percent of builders reported that the supply of lots in their markets was low or very low-up from 43 percent September of last year, and the largest low supply percentage we've seen since we began conducting these surveys in 1997," said NAHB Chief Economist David Crowe in a statement. "One reason is that many residential developers left the industry, abandoned certain markets or simply stopped buying land and developing lots during the downturn."
The shortages have resulted in higher prices for builders who are able to obtain developed lots. In the survey, 60 percent of home builders said the price of developed lots in "A" locations is somewhat or substantially higher than it was a year ago.
Other factors holding back recovery, according to the NAHB, are shortage of labor in carpentry and other key building trades, limited availability of loans and the recent uptick in interest rates.
