Demand for new housing construction is increasing in the metro area, fueled by good market conditions and job growth. But while new projects are underway in suburban Virginia and Maryland, and experts say a wave of new construction is in the offing, it may take several years to reach "normal."

Part of what is driving new construction is a shortage of resale housing inventory, which hit lows in July not seen since 2005, as uncertain sellers remained on the fence.

"More homes need to be built in the local market to help relieve tight inventory conditions, but overly stringent construction loan underwriting is holding back many home builders," said Lawrence Yun, chief economist at the National Association of Realtors. "Without more construction, home prices in the region will rise too fast and too soon and cut into first-time home buyer opportunities."

So far this year, Maryland and Northern Virginia have outpaced the District in the construction of new homes.

"Loudoun and Prince William counties in Virginia and Montgomery County in Maryland are particularly active," said Stephen Nardella, a senior vice president at Winchester Homes.

Maryland was up by 34 percent statewide, compared with the same point in 2011, according to building permit statistics through June 2012 from the National Association of Home Builders, or NAHB. Virginia was up 17 percent, and the area including Washington, Arlington and Alexandria was up 3 percent.

"2012 is shaping up to be the best year of recovery so far," Nardella said. "Since bottoming out in 2009, new starts have recovered modestly every year."

When deciding where and when to build, Nardella analyzes job and income growth, building permits, sales and closing statistics for new homes, population and household growth. He then drills down to the county and submarket levels, looking at the competitive environment, including what new projects are in the approval pipeline, what is open for sale and where, and what plans and price ranges are generating the most activity.

"We look at the resale market as a leading indicator. Listings, days on market, months of supply, sales and prices -- a balanced resale market is healthy. Too little inventory can mean that people are not moving," he said.

Robert Denk, assistant vice president for forecasting and analysis at NAHB, said the market is stabilizing but it will take time. By the end of 2013, he expects new housing starts to be at the midway point toward a normal market.

"It's been all about the Virginia suburbs so far," he said. "Price stabilization is key. Places around the country are on eggshells, and D.C. is one of the healthier markets. Getting back to something like normal is going to be a multiyear process," he said.