A growing scarcity of well-located finished lots for builders could temporarily put a damper on new home construction momentum, according to a Fitch report.
“While we are in the midst of a recovery and believe the opportunity for new construction to regain share of the total housing market is ripe, a lack of available finished lots in desirable locations during the next 12-15 months could hinder progress,” according to the report. “Finished lots that are already graded and have infrastructure in place are becoming scarce, as development activity during the recent downturn was limited.”
Fitch analysts said they do anticipate more development but also a “catch-up period” where “there may be shortages in certain geographies in the intermediate term.”
