Mar 22

Builders Slow Production

Builders Slow Production

Construction on new homes weakened in February as material costs—notably on lumber—continued to challenge growth in new-home construction.

Housing starts—including for single-family and multifamily building—fell 10.3% to a seasonally adjusted annual rate of 1.42 million units in February, the U.S. Department of Housing and Urban Development and Census Bureau reported Wednesday. Broken out, single-family starts fell 8.5% last month to a 1.04 million seasonally adjusted annual rate while the multifamily sector—which includes apartment buildings and condos—fell 15% to a 381,000 pace.

However, buyer demand still remains strong.

“Despite strength in buyer traffic and lack of existing inventory, builders are slowing some production of single-family homes as lumber and other material costs, along with interest rates continue to rise,” says Chuck Fowke, chairman of the National Association of Home Builders. “Shortages of lumber and other building materials, including appliances, are putting future construction expansion at risk.”

Still, regardless of last month’s dip, NAHB Chief Economist Robert Dietz notes that single-family starts for the first two months of the year remain 6.4% higher than the first two months of 2020. Overall, “there has been a 36% gain over the last 12 months of single-family homes permitted but not started as some projects have paused due to cost and availability of materials,” says Dietz.

Single-family home building is still forecasted to increase in 2021, but Dietz says it likely will be at a much slower rate as housing affordability is challenged by higher mortgage rates and rising construction costs.

Regionally, combined single-family and multifamily housing starts only rose in the West last month, up 17.6% compared to the previous month. Meanwhile, housing starts dropped by 39.5% in February compared to January in the Northeast, declined 34.9% in the Midwest, and were 9.7% lower in the South. Dietz notes that February’s winter storm prompted home building to decline in Texas and some neighboring states.

Homebuilding likely will continue to face declines over the coming weeks. Housing permits—a gauge of future activity—declined 10.8% in February to a 1.68 million unit annualized pace. Broken out, single-family permits fell 10% to a 1.14 million unit rate and multifamily permits decreased 12.5%.

Source:
National Association of Home Builders
©National Association of REALTORS®
Reprinted with permission

admin

For all of your Real Estate needs, place yourself in the competent hands of a career Realtor who is a Philadelphia native and Delaware County resident. Skilled, smart and enthusiastic about his work and his life, Anthony DiDonato has the appealing combination of business sense and people skills gives him an edge in an industry that demands both.

Educated at Drexel University with a dual major in accounting and finance and minors in management and psychology Anthony DiDonato offers over 25 years of experience in the real estate industry. He has been a real estate investor since 1985 and a member of H.A.P.C.O. (Landlord Association). He became a licensed Realtor in 1992 and a member of the Local, Pennsylvania and National Associations of Realtors. Anthony DiDonato is also a member of the Computerized Multiple Listings, (MLS) and Internet Marketing Programs. In 1997 Anthony DiDonato became Century 21 All-Elite, Inc. Corporate Secretary.

Anthony DiDonato believes in taking his profession to the highest level of quality service. He is known for finding that “perfect” property in Philadelphia, Delaware County, Chester County, Montgomery County and surrounding areas in Pennsylvania for his buyers and helping his sellers prepare their properties so they sell quickly and efficiently.

When it comes time to negotiate the terms of a contract, Anthony DiDonato has the knowledge, experience, and professionalism applied to meeting – or exceeding – his clients’ expectations. His service to his clients is second to none. His honesty and integrity have been his claim to fame.

For Superior Real Estate Representation in the Delaware Valley, Philadelphia, Delaware County, Chester County, Montgomery County and surrounding areas in Pennsylvania… call Anthony DiDonato.