Census Bureau: New Residential Construction Permits Rose In February

Although some indicators for new residential construction growth dropped in February, The Federal Savings Bank was pleased to see that building permits rose from the previous month, according to the U.S. Census Bureau and the Department of Housing and Urban Development (published on March 17, 2015). The joint report found housing starts dropped 17 percent in February from the previous month. The latest housing completion figures were also down, dropping 13.8 percent from January. Completions for single-family homes in February reached 595,000.
Despite the falling new residential construction, the number of building permits for privately owned housing units in February grew 3 percent month over month. This also represents a 7.7 percent increase from February 2014.
The lagging growth in the single-family construction market is attributed to the harsh weather that could impede new home building.
Compared to January, builders broke ground on almost 100,000 fewer homes in February, reaching 897,000 units.
The results of the latest report indicate that there could be fewer single-family homes in the next season as builders concentrate on other property types.
“This means that inventories of single-family homes will remain tight this spring and it is likely a reflection of builders continuing to focus primarily on move-up, luxury and retirement homes rather than producing affordable ones,” said Jonathan Smoke, chief economist at realtor.com, in a March 17th article published on the site.
Why house hunters can look forward to spring
The Federal Savings Bank thinks first-time home buyers and other house hunters can look forward to spring as the housing market heats up. There are recent lending changes that make credit more accessible to home buyers than it has been in the past, as some lenders have lowered their down payment requirements and mortgage insurance premiums. These actions combined with low interest rates could increase affordability for house hunters in the spring.
First-time home buyers can contact The Federal Savings Bank, a veteran owned bank, to learn more about mortgages.