After the federal tax credit for new homebuyers expired earlier this year, analysts in Rockland, NY were waiting with bated breath to see how the construction industry would fare. The verdict? New construction is down, but remodeling projects are steadily and visibly increasing.
New Construction Dips
The U.S. Commerce Department released two statistics that proved disappointing for builders: home construction decreased 10 percent in May alone, and applications for building permits were down by nearly 6 percent. The single-family home market also saw a 17-percent decline, its lowest since 1991.
Homebuilders are quickly losing confidence in Rockland and surrounding areas as they attempt to attract buyers without the added tax incentive, while also competing with the sale of foreclosed homes. As of right now, the majority of new construction is high-end condominiums in areas like White Plains, New Rochelle and Yonkers.
Remodels on the Rise
One small but clear upside to all the construction sector woes? Homeowners may be staying put, but they aren’t giving up on remodeling. The Rockland County Builders and Remodelers Association reported that remodeling projects have seen a significant increase since April. The only difference between this spike and years’ past is that homeowners are sticking to a smaller budget.
While the housing market may still be limping along, the remodeling construction seems to be the light at the end of the tunnel.