Houses in construction sit at the Kennedy Farm development on Hillhurst Road May 31, 2019.
In a news release sent out by the Building Industry of Clark County (BIA), the BIA estimated that 35,605 Clark County families will be priced-out of purchasing a home in 2021.
The estimate comes from the most recent study conducted by the National Association of Home Builders (NAHB). The study states that for each $1,000 price increase in the cost of median-priced new homes in Clark County, 985 prospective buyers will be pushed out of the market, which is an increase of 204 from the 2020 numbers.
“This study illustrates how even a relatively small increase in housing prices can dramatically impact housing affordability and accessibility for our neighbors,” Executive Director of the BIA Avaly Scarpelli said in a news release. “Unfortunately, with lumber prices on the rise again and the recent implementation of the Washington State Energy Code, housing affordability will continue to worsen in 2021.”
According to the release, between mid-April and mid-September of 2020, the cost of framing lumber went up more than 170 percent. According to the NAHB, this resulted in an increase of more than $16,148 in the price of a new single-family home. This raise in lumber prices will result in an additional 15,905 buyers being priced-out of homeownership, the release said.
If the estimates provided by the Building Industry Association of Washington are correct, the price of a newly constructed home will rise as much as $20,000 due to the implementation of a stricter Energy Code, effectively pricing-out another 19,700 families. When both increases are taken into consideration, a total of 35,605 buyers will be priced-out of buying a home in 2021, according to the release from the BIA.
This estimate does not take into consideration the other variables that can increase home prices: additional regulatory barriers, labor shortages, and the looming rise of interest rates as soon as 2022. All of these factors work together to prevent families from achieving their dreams of homeownership.
“Our elected leaders need to recognize and take accountability for the consequences of their policy decisions. We cannot complain about a housing affordability crisis and then pass policies negating any efforts made to make housing more attainable. The homebuilding industry agrees with the notion of increasing energy efficiency and working towards more sustainable structures. However, when the families in our county and state cannot afford to have a roof over their heads, it’s time for our elected officials to consider postponing expensive mandates,” Scarpelli said.
