INDIANA NEW HOME CONSTRUCTION INCREASES AS CAUTION GROWS
The U.S. Census Bureau recently released statewide totals for statewide building permits issued in October and shows 1,470 single-family permits were pulled. This number is up 15% from September of 2018, when 1,277 permits were pulled. The 1,470 permits pulled in October of 2018 are up 4% from the 1,416 permits pulled in October of 2017. The single family permit numbers (14,071) for 2018 are up 6% compared to the first ten months of 2017 (13,271).
“As the numbers indicate, there is no better time to build a home in Indiana,” said Indiana Builders Association recently elected President Don Thieneman. “Builders and business owners in the industry are encouraged by the growing demand, but will have to soon find ways to battle housing affordability obstacles that loom.”
Growing affordability concerns resulted in builder confidence in the market for newly-built single-family homes falling eight points to 60 in November on the NAHB/Wells Fargo Housing Market Index (HMI). Any number over 50 indicates that more builders view sales conditions as good than poor. Despite the sharp drop, builder sentiment still remains in positive territory.
“In the face of the growing interest rates on mortgage loans, demand for new construction has remained strong,” said Indiana Builders Association Chief Executive Officer Rick Wajda. “Although we saw a softened market in summer months, construction volume is set to be the best since the downturn. However, policy makers should be aware that a decline in builder confidence in November could be a sign that supply-side affordability conditions will carry more weight on the market moving forward.”
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