Homebuilders last year had their busiest year since 2007, as construction expanded. That stands in contrast to six years ago when, even though more permits were issued, housing here was slumping amid a national housing bust.
Final figures from the Central Oklahoma Home Builders Association show 4,684 building permits issued in 2012 in Oklahoma City, Edmond, Midwest City, Moore and Norman — a 31 percent increase compared with 2011 and the most since 2007.
Oklahoma City permits were up 33 percent, Edmond's were up 52 percent, Midwest City's were up 26 percent and Norman's were up 16 percent. Only Moore's were down — 4.4 percent — but builders said Moore didn't suffer the slowdown as much as the rest of the metro area and so had less to make up.
“We finished up with a strong December and ended the year with one of the best year-to-year increases in quite some time,” said Kurt Dinnes, co-owner of Sun Custom Homes and president of the association.
Buyers are back
Would-be homebuyers are back in the market after sitting out a prolonged period of economic uncertainty, including tightened post-crash and post-recession lending standards that have left many unable to take advantage of loan rates of a lifetime. The average interest paid for a mortgage here in December was just 3.52 percent, according to the Oklahoma City Metro Association of Realtors.
“What has happened is there's been a pent-up demand,” said Mustang developer Robert Crout, who is 2013 president of the builders group. “The consumer has been confused,” he said, by economic doubt and political wrangling at the federal level. “Finally, they decided, ‘We have to have a place to live and we want to go forward with our building plans,'” Crout said.
Ideal Homes of Norman had its third best year ever in 2012, said Steve Shoemaker, director of marketing.
“The fourth quarter alone was the fourth-largest quarter in company history,” Shoemaker said. “The increase is nice, but the consistency is the most welcome attribute of the current market. All the things we track about the market seem healthy. We feel really good and well positioned right now.”
Overheard in Vegas
The situation in Oklahoma City contrasts with what metro-area builders heard this week at the International Builders Show in Las Vegas. The show is the largest annual convention of homebuilders, suppliers and service providers.
“What I've heard at the convention is not the same at all,” Crout said. “A lot of the things I've heard are, ‘Well, it's not getting worse as fast,' and a few are saying, ‘Well, we've bottomed out.' Some say they're seeing some uptick.”
Dinnes, also at the show, said he found the mood mixed among builders.
“Most parts of the country are showing positive signs with respect to new housing starts. Most (homebuilders associations) and (the National Association of Home Builders) are recognizing that the homebuilding downturn has turned the corner and there is cautious optimism by most. Once again Oklahoma as a whole, especially Oklahoma City, remains one of the leaders in the homebuilding recovery around the nation.”
Shoemaker said he heard some consumer research at the show that frames housing's near future.
“Eighty percent of people think it's a good time to buy a home — but a large portion of first-time buyers are not confident that they can afford a home. So, ‘Yes, it's a good time to buy, but I'm not sure I can.' That's something to watch. Looks like buyer education will become a bigger part of the sales process with first-time buyers,” he said.
Shoemaker said Ideal Homes, one of the biggest builders in the Oklahoma City area, has been trying to woo buyers with details. He pointed to Ideal's Red Canyon Ranch in Norman and Valencia in northwest Oklahoma City, the builder's top-selling neighborhoods, as examples.
“Our biggest change has been the level of customization we are providing buyers. We've revamped our entire product development and design center process to accommodate buyer expectations,” he said. “We've also placed a huge emphasis on our neighborhood development and amenities. People decide where they want to live before they decide what they want to live in. So we're incorporating a lot open space, parks, splash pads and so on.”