Housing Starts ????

i just read where housing starts are expected to reach over 600,000 this year (2010). This seems very low as there are a new 1.2 million people every year who want or need housing. Housing starts should be, on a 5 year average, no more than 120% of this expected "adult population growth" and no less than 80% of it.
I just read someone's interpretation of these stats and they were saying that now is a great time to buy development land as an investment. I agree, but only if you understand your market. The Central Ohio market has a lot of partially completed developments where the current owners are looking to move lots quick (and cheap). There are a bunch of reasons for them to dump their lots, but buyer beware!
A note if you are thinking that a cheap lot in an expensive new subdivision sounds like a good idea. The builders who started these developments mostly did so during the housing boom of 2004-2006. As sales declined they were forced to make adjustments to their costs and did so with lesser quality labor and materials. i know this isn't true for some builders, but even these quality guys will agree that it is true for most builders. Also as sales declined, starts did too because no builder wants to get stuck with a spec home in a down market. Last year housing starts were less than a fourth of what they were in 2006, so those homes that were built in "phase 1" of these developments were sitting next to expanses of developed, yet empty, lots. Housing prices tumble through 2008 and 2009 and now those first homes built are worth less than what a lot of people owe on them. Foreclosures! How can a builder, who is already behind the eight ball with this development, move forward and build new homes and get the buying public to believe that they are worth more than the 3 year old homes of the same size and style, in the same neighborhood, built by the same builder? He can't, so he is going to try to get rid of these lots.
Someone is putting out there that development land is a great investment right now. I agree that it can be, but please call me before you make a move you could regret.