The Sacramento Bee
From the article:
Sacramento's giant home-building machine stopped in its tracks when the housing market collapsed seven years ago. Now, with the market improving, it's proving difficult to restart.
Home builders, caught off guard by the suddenness of the upturn, say they're struggling to meet growing demand – primarily because they can't find enough lots to put houses on.
"Everybody's just going as fast as they can, but you can't just flip a switch and expect to be up to full production," said Chris Cady, Central California division president of KB Home, one of the nation's largest builders.
The bottleneck in home building is limiting the supply of new homes and driving up prices. That's good for sellers, but not so much for buyers, a growing number of whom are trying to take advantage of record-low mortgage rates. With resale homes in short supply, they're turning to new homes, only to find those in short supply, too.
The holdups in home building also are delaying construction-related jobs from recovering more quickly. When it's humming, construction is a major economic force in the Sacramento region.
"If this picks up momentum and we start to see an expansion in home building again, you'll feel it," said economist Jeff Michael with the University of the Pacific in Stockton. "That would make a stronger impact on the job market than anything else in Sacramento."
Today, the biggest factor holding back housing construction in the Sacramento region is not a lack of buyers, builders say. It's a scarcity of lots that are ready or nearly ready to build on.
Long-term, Sacramento has no lack of land on which to spread out. Local governments approved tens of thousands of new homes during the boom years, development that eventually will spread north, south, east and west of the capital.