Home builders in Williamson County continued building through the peak of the coronavirus outbreak, but say it’s still too early to discern the virus’ impact on future building.
According to data from the U.S. Census Bureau, the number of housing starts nationally has already started to decline precipitously. The number of new housing starts fell by 30% last month, compared to the year before.
Last month, the city of Franklin issued 33 building permits for new, single-family homes, an average month for the previous year. In March, the city issued 31 permits.
While those recent numbers look normal, Dan Gilbert, Vice President of Home Building for Southern Land, said that the real impact of the virus on home builders won’t be clear for several months.
“If you really want to have an idea of optimism, I would take a look at the next couple of months of permits,” he said. "If you see a lot of new stuff coming out of the ground that means the builders are confident that what they started is going to sell.”
Gilbert said many of the homes that received permits in March and April were likely in the pipeline before the coronavirus arrived in Tennessee.
In Williamson County, total home sales fell by more than 22% last month, and new listings declined even more dramatically. However, builders like Southern Land and Regent Homes reported that they’re feeling optimistic about the market for brand new homes. The National Association of Home Builders recently reported that new home sales in the U.S. only dropped by about 6.2% in April.
Regent Homes President David McGowan said his company will only suffer a minor setback because of the coronavirus. He expects to do 80% of the business originally projected at the beginning of the year.
“During the time that they had stay-at-home orders for about two weeks, traffic in the models was slower,” he said. “Now that it has been lifted, things have really picked up. I would tell you that most builders would probably report that sales are good right now in Williamson County.”
McGowan said he believes that restrictive growth policies have led to a lack of housing supply in the county—especially affordable homes—and job growth has contributed to consistent demand. He believes those fundamental economic factors are much more important to the housing market than the coronavirus outbreak.
Gilbert said the coronavirus pandemic may even be driving people from dense urban areas hit hard by COVID-19 to more suburban locations like Williamson County. McGowan said he has seen a similar trend.
“It was already a trend. Now, the fact that more people can work from home, they can work from wherever they want … I think more people are looking to get out of those dense cities,” Gilbert said.
Both McGowan and Gilbert said they are already thinking about how to design homes that accommodate the shift to remote work caused by the coronavirus. They expect buyers to look for more space, especially flexible space that could be used as a home office.
“I think you have more people that … right now are in a bonus room or a bedroom,” Gilbert said. “We think buyers will be looking for that flex space so that if something similar happens again they'll have a more comfortable area to work from home.”
McGowan said the virus outbreak has also slowed down construction on his homes. It’s harder to schedule crews in a way that allows for social distancing, and he said some suppliers for cabinets, doors and light fixtures shut down to prevent the spread of the disease.
In addition, local governments had to limit their services during the height of the virus outbreak, making it harder to get approvals from building inspectors.
Still, both McGowan and Gilbert are bullish on the Nashville area. They expect it to bounce back quicker because it wasn’t hit as hard by the virus as other large metro areas like New York or Seattle.