Lot Supply Up Again According to New Zonda Index

For the second consecutive quarter the New Home Lot Supply Index shows an increase in what’s available.

The new Zonda Index reports a 5.4 percent increase for the fourth quarter of last year, which is good news for builders. “Land and lot supply is at the healthiest levels we’ve seen in years,” according to Ali Wolf, chief economist with Zonda. “Between 2021 and 2022, builders expressed concerns about a potential shortage of buildable lots due to rapid demand growth. However, lot supply surged in late 2022 and early 2023 as consumer demand softened while lot development continued. Currently, the market is characterized by steady growth in both lot supply and new housing starts.”

Two metropolitan areas showed the biggest gains in land supply, Zonda said: Orlando up 7 percent, and San Francisco, up 5 percent. “Total upcoming lots provide valuable insights into the trajectory of the land and lot markets over the next year, and the outlook is positive,” Wolf said. “Now, all eyes are on housing starts. Assuming consumers can navigate the current environment of persistently high interest rates, we anticipate modest growth in single-family starts during 2025.”

BACK TO NEWS