RAINING ON THE PARADE?
Supply issues could complicate annual spring show in OKC area
So, you’re watching a parade, enjoying the floats — but some aren’t quite finished, just partly decorated, with their usually hidden frames and other infrastructure showing. What would you think?
Homebuilders hope you’ll think kindly, because it’s their upcoming 2022 Spring Parade of Homes that has some unfinished entries.
Supply chain issues and materials shortages, a problem throughout the COVID-19 pandemic, have hit the parade, which is this weekend and next.
The parade, organized by the Central Oklahoma Home Builders Association, will feature 56 new homes by 26 builders, open free to the public from noon to 6 p.m. this Friday to Sunday and again from April 29 to May 1. Parade guide books are available for free at OnCue Express.
An incomplete home might be just what some home shoppers are looking for, the builders group says online, turning supply lemons into home-site lemonade.
“Jump on one of the not-yet-completed homes and pick your own finishes — like flooring, paint color, plumbing and light fixtures, and more — to make your new home purchase truly your dream home!” the builders suggest.
At least one incomplete parade home is already under contract to sell and was removed from the lineup, said Elisa McAlister, executive officer of the Central Oklahoma Home Builders Association.
It’s another sign of the sizzling housing market.
Fewer homes than usual
Ideal Homes & Neighborhoods, for example, “had the largest quarter of sales in company history during the first quarter,” said Erin Yarbrough, director of marketing. “Demand is still greatly outpacing supply in the housing market.”
That’s why the home parade, sponsored by Oklahoma Natural Gas and Wilshire Cabinet + Co., again has fewer entries than usual, said Michelle Kirby, of Adams-Kirby
Homes, who is chairman of the parade.
“The market continues to be hot with homes selling faster than we can build them,” she said in the guidebook.
That’s despite rising costs to builders, which contribute to higher home prices, along with the shortage of homes relative to demand, and rising mortgage interest rates, which also make it more expensive to buy.
Building material prices have gone up nearly 30% since January, 2020, said Dusty Hutchison, owner of Alder Fine Homes and president of the the Central Oklahoma Home Builders Association.
Builders have dealt with increased costs for lumber, paint, steel products and concrete, Hutchison said.
“And major delays in the supply chain have led to challenges in obtaining products like appliances, hardware, and lighting,” he said in the parade guidebook. “It is no secret that our industry continues to experience significant challenges.”
All those building woes have resulted in the oddity of decreased construction so far this year, despite the so-far-sustained demand and the ongoing shortage of homes for sale.
Metro-area builders started 1,496 new houses the first three months of this year, down 3.2% compared with the first quarter of 2021, according to Dharma Inc.’s Builder Report.
Rising interest rates will tamp down demand as they make borrowing too expensive for some people, but so far they’ve had little effect, said Lindsay Haltom, director of marketing for Homes by Taber.
“While interest rates have crept up a bit, they are still considered low by most standards,” she said. “Homes by Taber’s lending partner, Stride Mortgage, has multiple programs to lock in rates early or lower their rates, if it is determined that is needed.”
A slowdown will probably be felt here toward the end of the year, said MJ Farzaneh, chief operations officer for Home Creations.
“We believe that with the current situation in the market place with the increase of costs, as well as escalating interest rates, we could see a much slower fourth quarter in the metro in terms of starts as a whole,” he said.
COVID-19 protocols
Builders have their own requirements at their parade homes. The Central Oklahoma Association of Home Builders also recommends these guidelines for touring the homes:
• Wear a face mask or covering if you think it necessary.
• Practice social distancing to the best of your ability.
• Wash your hands frequently and use hand sanitizer before entering each parade home.
• Keep the touching of surfaces such as countertops, doorknobs, and cabinet doors, to a minimum.