New home starts for single-family homes in the Greater New Orleans area are on the rise, according to Jon Luther with The Home Builders Association of Greater New Orleans. New construction starts were at 1.21 million last month, and that included single-family home starts of 600,000 – 700,000. Between commercial building conversions and new construction, apartments are leading the race on new construction in New Orleans simply because the opportunity to build new homes is more limited within the city limits because of the lack of land to build. However, even if builders cannot start and build out full-scale, new home developments, there is plenty of new construction going on in the city in the form of tearing down blighted housing and even taking an existing home “back to the studs” and starting over again as a complete rebuild.
“Anytime you see 600,000 to 700,000 new (single-family) starts, home builders are going to be pretty damn happy,” Luther said. “They’re the best numbers we’ve seen in about 10 years.”
According to Luther, the best chance that New Orleans has of starting and building a large scale development would be to utilize the 5,000 acres of land near the Avondale shipyard. Officials in Jefferson Parish have had several meetings about rezoning this property which is owned by several different owners. If they were to release the land for building purposes, New Orleans would be able to develop and build either a Traditional Neighborhood Development (TND) or similar master planned community on this property.
Another obstacle for providing new homes for home buyers on the Southshore in New Orleans is that it is difficult for builders to provide housing for first-time home buyers. According to Luther, the appraisal system in New Orleans recently went through an overhaul to ensure that appraisers knew how to appraise a new home for sale in New Orleans because the values given during appraisals were losing local builders a lot out of their profit margins. Also, with the recent concessions by the Department of Housing and Urban Development in lowering the down payments on FHA loans for first time home buyers, there is now a possibility of Millenials being able to move out of apartment living in owning their own home – as long as affordable housing can be built in New Orleans.
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