New data from the National Association of Homebuilders indicates that construction loan rates increased nationwide in the third quarter of this year. The NAHB’s Survey on Acquisition, Development & Construction tracks four kinds of loans: land acquisition, land development, single family construction: speculative, and single-family construction: sold.
As late as the third quarter of 2020, the interest rates had a downward trend, NAHB reported, but that trend has since reversed. “In the third quarter of 2021, the average effective rate (based on rate of return to the lender over the assumed life of the loan taking both the contract interest rate and initial fee into account) increased from 6.15 in the second quarter of 2021 to 6.50 percent in the third quarter of 2021 on loans for land acquisition, from 7.15 to 8.33 percent on loans for land contract interest rate, or in the initial points charged on the loan,” he said.
The contract rate increased from 4.63 to 4.74 percent for land acquisition loans; initial points increased from 0.69 to 0.88. The contract rate for development loans increased from 4.63 to 4.74 percent; initial points increased from 0.64 to 0.89. The contract rate for pre-sold single-family construction increased from 4.32 to 4.49 percent; points increased from 0.54 to 0.77.
The last category that NAHB analyzed for AD&C loans was speculative single-family construction, which, unlike the other categories, saw a reduction in the average contract rate. The dip from 4.94 to 4.85 percent, Emrath explained in his report, “was more offset by a substantial increase in the initial points charged -- from 0.66 to 0.87.” development, from 8.09 to 8.55 percent on loans for pre-sold single-family construction, and from 7.40 to 8.37 percent on loans for speculative single-family construction,” Vice President for Survey and Housing Policy Research for NAHB Paul Emrath wrote in a Nov. 19 article. “Changes in the effective rate may be due to changes in either the contract interest rate, or in the initial points charged on the loan,” he said.
The contract rate increased from 4.63 to 4.74 percent for land acquisition loans; initial points increased from 0.69 to 0.88. The contract rate for development loans increased from 4.63 to 4.74 percent; initial points increased from 0.64 to 0.89.
The contract rate for pre-sold single-family construction increased from 4.32 to 4.49 percent; points increased from 0.54 to 0.77. The last category that NAHB analyzed for AD&C loans was speculative single-family construction, which, unlike the other categories, saw a reduction in the average contract rate. The dip from 4.94 to 4.85 percent, Emrath explained in his report, “was more offset by a substantial increase in the initial points charged -- from 0.66 to 0.87.”
To wrap up the first day, attendees were able to meet up for a social event at the Brad Halling American Whiskey Ko. in Southern Pines where a $10,000 check was presented to the Joint Special Operations Foundation for their scholarship fund. Photo pr
The three-story, 200,000 square-foot business incubator space is located at 420 Maiden Lane. The building features an elevator, construction has begun on handicap bathrooms for the first floor and the second and third floors feature window walls offering views of Segra Stadium.
Image provided by FTCCFocused on building the local workforce and streamlining the education process through real world learning, the Hope, Opportunity, Prosperity through Education Program at Fayetteville Technical Community College (FTCC), also kno
