In the Pipeline

From the Sacramento Business Journal:

Developers are seeking approval of a record number of new homes in the Sacramento region, even as sales have dropped to their lowest level in years. Through the end of last year, a total of 99,438 single-family houses, condos or townhomes were in the development pipeline in the six-county region, according to Hanley Wood Market Intelligence. That's a 13.6 percent increase from December 2004, the most recent comparable data. Over the same period, new-home sales plummeted 44 percent.
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Excluded from that total are thousands more homes at either end of the spectrum. Unsold homes and lots in existing new-home communities aren't included because they have completed the entitlement process and theoretically are already on the market. Also excluded are parcels in master-planned areas that are still years from serious consideration for approval. Those categories boost the expected Sacramento housing stock by at least another 84,000.
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The Gregory Group, another new-home analyst, reported that new-home sales fell from a peak of about 17,100 in 2004 to about 9,500 last year, the lowest since the company started tracking sales in 1999. At the current rate, 100,000 new homes would be a 10-year supply.
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Brendan O'Neill, president of the Sacramento division of Beazer Homes, said building advocates are calling for what they refer to as a "20-year visible land supply," which would mean as many as 250,000 lots available for building. He said a ready supply of land for housing reduces costs during peak housing markets, attributing the run-up in home prices between 2002 and 2005 to a scarce supply of entitled land.