Oklahoma City area homebuilders are building more houses than they have in seven years, but the market keeps soaking them up, as well as previously owned homes — amid a pandemic and rolling business shutdowns.
It doesn't seem to be putting a dent in the housing shortage.
"Crazy times," said Jim Schuff, co-owner of Vesta Homes in Moore. "When we first heard about COVID-19 and things began shutting down, we thought, 'This is going to be a tough year.' Little did we know that it was going to be tough in a different way."
Different as in unexpectedly busy on unanticipated demand.
Builders started 641 houses last month, 25.7% more than in October 2019, in Oklahoma City, unincorporated Oklahoma County, Bethany, Blanchard, Choctaw, Edmond, Midwest City, Moore, Mustang, Newcastle, Noble, Norman, Shawnee and Yukon, according to Norman-based Dharma Inc.'s Builder Report.
So far this year, they've built or started 5,079 houses, 14.3% more than in the first 10 months of 2019, Dharma reported.
For their part, Realtors brokered 1,890 home sales last month, 20.6% more than in October 2019, in Oklahoma City, Arcadia, Bethany, Blanchard, Choctaw, Deer Creek, Edmond, Harrah, Luther, Midwest City, Moore, Mustang, Newcastle, Nicoma Park, Norman, Piedmont, Tuttle, Warr Acres and Yukon, according to the Oklahoma City Metro Association of Realtors.
So far this year, Realtors have sold 17,894 homes in the metro area, 8.2% more than in the same period last year, the Realtors reported.
The shortage is still on, with just a 1.3-month supply and houses selling fast, in just 27 days on average, 10 days faster than in October 2019, according to the Realtors.
Persistently low mortgage rates keep boosting buying, as well as refinancing. Mortgage interest averaged 2.72% this week, not counting fees and "points" paid at closing to buy down a loan rate, according to Freddie Mac.
The buying is boosting prices. The average sale price here for the year through October was $239,726, an increase of 7.2% compared with the same period last year. The median price — considered a better gauge of the market because one-half of homes sold for more and one-half sold for less — was $206,900, an increase of 8.9%.
When the coronavirus hit hard in March, Vesta Homes had 18 spec homes under construction — speculative, meaning with no buyers lined up — and four furnished models, said Schuff, who is vice president-treasurer of the Oklahoma Home Builders Association and will be installed as president in January.
They didn't last on the market for long.
"We sold over 20 homes in about two months. We hired movers and rented storage units for model home furniture while meeting with buyers and doing everything we could to keep construction going. Prior to this we were already experiencing a labor shortage so you can imagine how this has affected construction," Schuff said. "Every builder I know is just as busy as we are and we all share the limited number of subcontractors, so production time has nearly doubled.
"There has been a minimal supply of nearly everything housing related from lumber and appliances to furniture. Plants across the country were shut down in the beginning and once they reopened, they limited the number of employees on a given shift in order to maintain a safe distance between employees. So, we have experienced a slower supply with such a huge demand all at once."
Despite all, Oklahoma City's most active builder this year, Homes by Taber, has increased market share from 9.5% in 2019 to 14% this year, said Lindsay Haltom, director of marketing.
"There are so many people that need to move for strong reasons or that still want to take advantage of the low interest rates. Our motto throughout this entire time has been, 'You still need a home. We're still here to serve you,'" Haltom said.
"We are fortunate to be open and all employees are fully embracing the very strict protocols we have implemented to keep our customers and employees safe. While everyone is growing tired of the pandemic, our commitment to our customer's and employee's safety will not change."
She added, "While no one in the real estate industry could have expected such an increase in demand throughout this pandemic, we've been proud to see shoppers choose us for our Healthy Home Technology that you can't get in other builds or in used homes."
Schuff said it's taking longer for houses to be built because of tight labor and materials shortage, and because some builders are pausing for relief from for soaring lumber prices, some 30% higher now than in summer because of the high demand and coronavirus-related plant shutdowns and supply chain disruptions.
"We are in the final stages of the last couple of homes that we contracted back in April and May and now are transitioning into replenishing our inventory," he said. "The buyers are still out there. They are calling and asking to see the plans for slabs that are being poured and asking the big question: 'When will it be complete?' ... Buyers for the most part have been very understanding about the delays in labor and/or materials.
"One thing we have learned in 2020 is to expect the unexpected."
