Fewer McMansions in supply as new home construction dwindles

As the fall in home prices takes its toll on builders, new home construction is sluggish and supply for those who want them is dwindling. It simply doesn’t make sense for builders to construct a custom-made home when, according to chief economist David Crowe of the National Association of Homebuilders, home appraisals fell below the cost of homebuilding for 56 percent of builders recently surveyed. That means McMansion bargain-hunters may have to act quickly, or settle for one that’s already built. The NAHB predicts market improvements in 2011, but in a changed environment in which first-time homebuyers and empty nesters with more humble demands will drive growth in new home construction.