Monday, January 21 2013
Builders broke ground on new homes in December at the fastest pace in more than four years offering a “solid ending to 2012 and a promising start to 2013,” according to the National Association of Home Builders.
Housing starts soared 12.1 percent in December, reaching a 954,000 annual rate and the fastest pace since June 2008, the Commerce Department reported Thursday. Most of the jump was attributed to a 20.3 percent increase in multifamily construction last month, helping the sector return to a nearly normal production pace by historical standards. Housing starts for single-family homes rose 8.1 percent in December.
"With inventories of new homes at razor thin levels, builders are moving prudently to break ground on new construction ahead of the spring buying season to meet increasing demand," says Barry Rutenberg, chairman of the National Association of Home Builders.
Permits for future home building — an indicator of future building — also rose slightly in December to its quickest pace since July 2008. Permits rose by the greatest amount in the Northeast by 19 percent and 6.6 percent in the West. The Midwest saw a 5.7 percent decline in housing permits, while the South saw a 3.4 percent decline in December.
Source: National Association of Home Builders and “Housing Starts Climb to Highest Rate Since June 2008,” Reuters (Jan. 17, 2013)
Friday, April 27 2012
Permits for new-home building — a gauge of future demand — reached its highest level last month since September 2008, the Commerce Department reported Tuesday.
New housing permits rose 4.5 percent in March, reaching an annualized level of 747,000.
But while the future of home building shows signs of picking up, actual construction started last month slowed, the second consecutive month for declines.
Builders broke ground in March on a seasonally adjusted annual rate of 654,000 homes, a 5.8 percent drop from February, the Commerce Department reported. The construction of multifamily homes — those with at least two units — posted a 16.9 percent drop last month while construction of single-family homes dropped slightly at 0.2 percent.
New-home building declined the most in the South — posting a 15.9 percent decline in March — while the Northeast saw a 32.8 percent gain and the Midwest saw a 1 percent increase.
The new-home market continues to struggle to compete against foreclosures and short sales plaguing many markets, which are often sold at big discounts. Coupled with that, new homes tend to be priced about 30 percent higher than previously occupied homes.
While builder confidence has been increasing in recent months, confidence showed a slight decrease in April, the first time it's declined in seven months, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
"Although builders in many markets are noting increased interest among potential buyers, consumers are still very hesitant to go forward with a purchase, and our members are realigning their expectations somewhat until they see more actual signed sales contracts," says Barry Rutenberg, NAHB chairman.
Source: “U.S. March Housing Starts -5.8% to 654K,” Dow Jones International News (April 17, 2012) and National Association of Home Builders