Since the economy has steadily started to improve, New Jersey has seen a spike in home building. While apartments take the lead in construction over single-family homes, builders are holding back in order to avoid building homes that will not sell quickly. While these residences are built, it is important to note that NJ Construction Liability can be reduced with the proper coverage.
Patrick O’Keefe, an economist with CohnReznick in New York explained, “They are not going to get ahead of where they think the market in the immediate future is going to be.”
North Jersey stated that New Jersey builders got approvals for 22,861 new residential units statewide, up 5 percent from 2014; yet single-family building permits were down 7.6 percent at only 7,700.
As such, builders are struggling to keep up with multi-family housing demands. Due to tightened lending requirements and people being wary of home value crashes, more people are choosing to rent rather than buy. What’s more, a recent study has shown an increase in student loan debt, which is also causing less people to be able to qualify to purchase a home. In addition, millennials crave flexibility in order to be able to relocate for a job if the opportunity arises.
Also contributing to the slow of single-family home building is banks’ stance of funding. “Banks are all convinced that if you build it, they will rent,” said River Drive Construction builder Joseph Langan. River Drive has completed a total of 158 apartments over the past few years and continues to construct homes in an attempt to meet demand.
O’Keefe also predicts that builders will take out more than $30,000 home permits in the state for all of this year. While this is still an enormous improvement from the $13,000 per year slump during the recession, these figures still represent a slower pace than the long-term average.
At Tri-State Insurance Agency, we will work with you to provide specialty coverage for your construction business. As your company works to keep up with demand, we can ensure your operations and your employees are safeguarded with quality, affordable coverage. To learn more, contact our experts today at (888) 990-0526.