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Residential real estate closes out 2016 fitfully

On Behalf of | Dec 29, 2016 | Residential Real Estate

During the tail end of 2016, the U.S. residential real estate market exhibited some significant ups and downs. Investors and developers in Delaware may be interested in knowing that even though some of these fluctuations were expected as par for the course, others exceeded what analysts thought might occur.

October began on good footing with new residential construction starts climbing by more than 27 percent over the previous month. This was the biggest increase since 1982, and it was accompanied by a 76 percent jump in new multifamily home construction projects. The next month, however, multifamily groundbreaking dropped by 45.1 percent and single-family construction dipped by 4.1 percent. Permit applications sunk by 4.7 percent overall, and in total, residential starts dipped by almost 19 percent.

Professional analysts still express confidence based on the fact that overall trends seem to be improving in the face of periodic market dips. Builders may have been stymied by low worker availability and insufficient numbers of lots, but many within the industry continue to believe that things will only get better under a friendly regulatory climate brought about by a new presidential administration. On the other hand, economists are still on the fence about whether interest rate hikes will slow down progress.

Investors, developers and companies that hope to succeed in the tumultuous modern world of residential real estate need to protect themselves from market swings. Those who agree to deals without proper planning may find themselves liable for significant losses after they discover that sellers failed to disclose specific property conditions or when they don’t account for factors like zoning laws. Discussing deals with an attorney before closing may make it easier to come up with a viable plan and legal terms that make transactions more lucrative.