Zonda's Ali Wolf Shares Insight on Current Single-Family Home Construction Market

In a recent article in Fast Company, ResiClub co-founder and editor Lance Lambert interviewed Zonda chief economist Ali Wolf to gain insights into the current state of the single-family home construction market. From current Q1 2024 data and strongest markets to incentives and prices, Wolf gives a full picture of what’s actually happening today and predictions for the rest of the year. Check out some of the Q&A below and click further to read the full piece.

Among the 10 largest publicly traded home builders tracked by ResiClub, they collectively recorded 77,255 net new home orders in Q1 2024. That’s up 18% year over year. Is it fair to say that single-family builders are having a strong start to 2024? And if so, what’s driving it?

Absolutely. New home sales have had a good start to the year, especially with interest rates holding in the high-6%s and low-7%s. The new home market has thrived in today’s market given the lack of resale supply, the narrowing price spread between new and existing homes, and builder incentives. Importantly, though, two different housing markets have emerged: that of larger, mostly public builders, and that of smaller and mid-sized builders. In the immediate market, larger builders have been able to be more aggressive with incentive usage when needed, including buying down the mortgage interest rates well below what a smaller builder is willing and able to do. Larger builders have also been able to be more aggressive in their land acquisition, intending to increase their community count both this year and next year. In the land market, the bigger builders have [priced] out some of the smaller builders.

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