Tucson had the highest new home sales and home starts since 2010 in the first half of the year according to Chapman Lindsey Real Estate Service reporting sales numbers reported to SAHBA by ten participating builders showed net sales of 473 homes for the second quarter, just two less than Q1 and better than any quarter in 2013 or 2014. The 948 sales for the first half of the year is 109 more (13%) above the first half of 2014 and 72 more than the first half of 2013. Historically the second half of the year has had fewer sales, but we should still expect higher sales in 2015 than last year.

In regards to single family housing starts, Q2 had 461 homes started. This was the largest amount of home starts for a quarter since Q1 2010 when 573 homes were started. Q2 in 2014 was just one fewer at 460 starts. The first half of 2015 has started 17 more homes than in the first half of 2014 (778 vs. 761). While not a huge increase year-over-year, it still shows a positive trend, and single family homes are maintaining positive momentum.

With that said, several communities have experienced incredible sales and subsequent housing starts over the past few months, more than making up for slow or nonexistent sales in other communities.

There were seven communities that averaged greater than 3 starts per month in first quarter. These top seven communities had 122 of the 317 SFR (38.5%) of the home starts in Q1. In Q2 this number increased to nine communities that averaged greater than 3 starts per month. These communities contributed 205 (44.5%) of the 461 home starts while prior communities remained in the group with two new additions. All but three of these communities are in the Northwest submarket:

Housing Starts Q2 vs. Q1

With the increased sales and housing starts, finished lot inventories are at an all-time low. Builders and investors recognize the shortage and are buying land.

The finished lot supply was reduced by 225 lots in Q2 with a total finished lot count of 3,420. There were 236 new finished lots in three communities added to the market in Q2: 172 lots in Golden Barrel at Dove Mountain (Mattamy); 49 lots in Desert Willow (Pulte); and 15 lots in Bear Canyon Overlook (AF Sterling). During Q2 there was a total reduction of 461 finished lots, 144 more than in Q1 and the largest quarterly total reduction in finished lots (lots builders started homes on removing them from the finished lot inventory) since Q1 2010 when 573 homes were started (Q2 2014 had just one less at 460 new home starts)

There are currently 7 communities (704 SFR lots) under construction throughout Tucson. Of these up to 173 lots could be completed in Q3 2015 and would be added to existing communities.

There are approximately 79 active SFR communities in the Tucson Metro area. Five communities were built out during the quarter, but still selling the remaining specs: 3 in the NW 1 in the NE and 1 in the SE submarket. As many as eight more communities could build out in Q3 2015 based on recent building trends.

Overall the market is stable and is showing steady growth. We expect our typical seasonal challenges causing some slowing toward the end of the year, but they will bounce back next spring. There are still many opportunities out there for builders and developers alike and there is a need for more lots in the market.

Click here for the full Tucson Land Update from Chapman Lindsey Commercial Real Estate.

To learn more Dan Feig and Aaron Mendenhall can be reached at 520.747.4000

This article has been archived, please login for access or subscribe now by going to the subscribe tab at the top of page.

Since becoming the first homebuilder listed on NASDAQ last month, LGI Homes is speeding up completion of contract agreements in Tucson for year end. The story of LGI Homes Successful IPO was published in the Real Estate Daily News on November 14, 2013. LGI is traded under the ticker symbol of LGIH.

LGI Homes has 93-lots under contract at Sonoran Ranch Estates, in Southwest Tucson. Phase I was for a 50-lot takedown in November for[mepr-show rules=”58038″]$1.225 million ($24,500 per finished lot) and the second phase of an additional 43-lots is scheduled to close before year end. Thrac Paulette of Vast Real Estate Solutions in Tucson represented the seller, Son. Land Company of Torrance, CA (John Agresti, manager).

LGI closed on 24-lots at Caddis Haley for $612,000 ($25,500 per finished lot) where they held the grand opening Nov 9^th at the 72 new home community in the Southwest submarket. Dan Feig and Aaron Mendenhall of Chapman Lindsey in Tucson handled the transaction for the seller, Caddis Bridge, LLC (Greg Anderson, manager).

In a separate transaction, LGI acquired 160 P&E lots in Blocks 7 & 8 at San Lucas in the Northwest submarket for $3.08 million ($19,250 per platted lot). The community is near Gladden Farms in Marana. Dan Feig and Aaron Mendenhall of Chapman Lindsey in Tucson handled the transaction for the seller, SL West, LLC (Greg Anderson, manager).

Feig and Mendenhall can be reached at (520) 747-4000 and Paulette is at (520) 624-9400 for more information.[/mepr-show]