BJD Property Management: housing starts

Showing posts with label housing starts. Show all posts

Saturday, December 21, 2019

US Housing Starts Fall From 12 Year Highs From Previous Month

Nationwide home building slid in September 9.4% after seeing a 12 year high in August. The revised figures shows a seasonally adjusted amount of 1.256 units as the numbers have been revised due to deteriorating construction numbers in the multi-family sector according to the Commerce Department.

Marketwatch reports that construction of apartments, condo complexes and other projects with five units or more sank 28% in September. Permits to build new houses also fell about 3% to a 1.39 million annual pace. The number of permits filed was nearly 8% higher year to year according to the report. On a positive note, new construction on single-family homes actually rose 2.8% over 2018 to an annual rate of 918,000. This is the highest level since the start of 2019.

Joel Kan, associate VP of economic and industry forecasting for the Mortgage Bankers Association remains positive on the numbers. He states “Housing starts fell 9% in September, led by a 28% drop in multifamily starts. The decline in multifamily starts was a reversal from a 41% increase in August. The 3-month average was down around 3%. More importantly to home purchase market, single-family starts remained robust, increasing slightly to a pace of 918,000 units – the highest since May 2019. However, the increase in single-family starts was solely concentrated in the South. Most of the country still needs more new construction to meet job growth and demand. It is promising that single-family permits continued to rise, increasing for the fifth consecutive month. As reported earlier today in MBA’s September Builder Applications Survey, some of the weakness in the data in September was likely the result of increased market volatility and uncertainty. Overall, the underlying trends remain relatively strong. The upward trend in single-family starts and permits bodes well for increased housing supply in the coming months, which has been a limiting factor for housing growth for a number of years.” Lawrence Yun, chief economist for the National Association of Realtors believes that developers need to ramp up activity in order to keep up with demand. He states that ” With new condo-rules on FHA mortgages, developers should anticipate rising demand for multifamily units. Building more homes is needed to help address housing affordability for both renters and home buyers. Increased supply will manage rent affordability, rather than the terrible policy of rent control. Furthermore, more home building will help boost economic growth. It is very likely that the GDP growth rate in the second half of this year will be light at under 2%. To get it moving higher, housing starts need to significantly ramp up.”

BJD Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx. Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://bjdpropertymanagement.com/us-housing-starts-fall-from-12-year-highs-from-previous-month/

Visit us at www.bjdpropertymanagement.com

Tuesday, December 17, 2019

U.S. Housing Starts Increase To Over Decade High In August

The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly announced that housing starts in August of 2019 has increased 12.3% to a seasonally adjusted rate of 1.364 million. This amount is 6.6% higher than the same time last year and the highest since 2007.

The highest rate of increase was in the multifamily sector where housing starts increased 32.8% to a seasonally adjusted rate of 445,000. Single-family construction increased 4.4% to 919,000. On a year to year basis only the Southeast has seen an increase of multifamily and single-family construction with an uptick of 4.4%. There has been declines in all other regions with the Northeast seeing a 1.8% decrease followed by the Midwest at 5.6% and West at 11.3%.

Joel Kan, Vice President of Economic and Industry Forecasting for the Mortgage Bankers Association believes that low mortgage rates and increased confidence in the job market have made builders more open to building. Kan also stated “Permits for new single-family construction increased for the fourth straight month, which is positive sign for prospective homebuyers and the housing market.”

On the builder's side of sentiment, Greg Ugalde, chairman of the National Association of Home Builders (NAHB) believes that the report falls in line with their projections. He goes on to say “However, builders continue to wrestle with affordability concerns stemming from excessive regulations and other supply-side challenges.” Chief Economist Robert Dietz for the NAHB believes that the signs indeed positive but the year overall has been forgettable. “Housing has been on an upswing in recent months as the pace of permits and starts has been rising since spring. While these are positive developments, single-family starts are down 2.7 percent year-to-date as the catch up process continues.”

BJD Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx. Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://bjdpropertymanagement.com/u-s-housing-starts-increase-to-over-decade-high-in-august/

Visit us at www.bjdpropertymanagement.com

Sunday, October 13, 2019

Home Building Shortage Will Last Until 2022 According To Experts

According to a survey rendered by Zillow of housing experts, the general consensus is that the home building shortage will last until 2022 or later. The survey which is called the Q3 2019 Zillow Home Price Expectations Survey asked more than 100 economists, investment strategists and housing experts for their opinions on when annualized housing starts will next reach one million. Only 1 in 5 panelists with an opinion about this matter (20%) said they expect single-family starts to reach that mark before the end of 2020. The majority believe that it will be in 2022 or later before housing construction of homes hits 1 million.

The million dollar statistical figure is considered the average rate as new single family home construction starts averaged 1 million every year since 1959. Since 2007, housing starts have failed to reach the figure. The graph above shows when the experts believe we will hit the average levels again. Besides 20% of experts believing that we will hit the level by 2020, twenty six percent of the participants (26%) believed it will happen by 2021, however the majority (54%) said the 1 million mark was most likely to be exceeded in 2022 or later.

“The panelists were thereafter queried in selecting three possible solutions that might make building easier, and to rank their selections in order of their expected effectiveness in goosing home building activity. The three most commonly chosen and highest-ranked actions chosen were:

Relaxing local review regulations for projects of a certain size (chosen by 56% of panelists
Reducing mandatory minimum lot sizes (38% of panelists)
Easing the land subdivision process for landowners (38%)”

The panelists were also asked to project growth for this year and beyond. Overall they expect annual home growth to slow to 3.6% at the end of the year. Presently annual home growth is increasing by 5.2%. Growth will slow even further to 2.5% in 2020 and 2.2% in 2021.