WASHINGTON — Nationwide housing production remained virtually unchanged in September, edging up half of a percent to a seasonally adjusted annual rate of 590,000 units, according to U.S. Commerce Department figures released Oct. 20. Meanwhile, issuance of new building permits, an indicator of future construction activity, fell by 1.2% to a seasonally adjusted 573,000 units.
“Builders are being extremely cautious right now in their efforts to maintain a modest inventory of new homes for sale,” said Joe Robson, a homebuilder from Tulsa, OK, and chairman of the National Association of Home Builders (NAHB). “On top of the fact that it is nearly impossible to obtain construction financing for new units, there are widespread concerns about what will happen to demand with the expiration of the $8,000 first-time homebuyer tax credit at the end of November.
“At a time when the national economy and housing market are just embarking on a fragile recovery period, Congress has the ability to keep things moving forward and create much-needed jobs across the country by moving now to expand eligibility for the tax credit to all homebuyers and extend the credit’s effective date for one year,” Robson added. “Doing so would generate nearly 350,000 jobs, $28.2 billion in wages, salaries and business income and $11.6 billion in additional tax revenues.”
“As our latest member surveys have indicated, new-home production is continuing at a very low level with few signs of improvement as builders confront the multiple challenges of a severe credit crunch for builder loans, inappropriate appraisals, and the impending expiration of the home buyer tax credit,” said NAHB Chief Economist David Crowe.
Overall housing starts posted a 0.5% gain to a seasonally adjusted annual rate of 590,000 units in September, returning to a production rate last seen in June. Starts of new single-family homes made up some of the ground lost in previous months with a nearly 4% gain, to a 501,000-unit rate, while multifamily starts fell 15.2% to 89,000 units.
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