Home purchases outpace new construction

Homes in the Springfield area are selling twice as fast as they're being built, according to the latest information from St. Louis-based real estate research firm The Zanola Co.

The company says in its latest MarketGraphics Housing Forecast that, at the current rate of sale, the Springfield market will reduce its housing inventory to normal levels by first-quarter 2010. Zanola's research shows permits being issued for new home construction at the rate of 854 annually, compared to 1,603 closings over the last 12 months.

Company President Joe Zanola said the data reveals two key factors for area builders: The market correction in the industry has led to a slowdown in construction, and a change in demographics is leading to an increase in the need for smaller homes, typically those costing $175,000 or less.

"Smaller square footage is the way of the future," Zanola said in a news release. "About 36 percent of the new homes in Springfield and surrounding areas are priced under $175,000, and there remains a big opportunity for more housing in that broad price range."

The company's full research report will be presented at an Oct. 20 luncheon from the Home Builders Association of Greater Springfield and the Greater Springfield Board of Realtors. Also on the agenda for that event is a presentation from Springfield Mayor Jim O'Neal, who will discuss the importance of economic development efforts in the city.

For more information on the Oct. 20 event, click on the link below.