National Real Estate News: Residential Building Permit Requests on the Rise

When examining and analyzing the health of a housing market, a number of different factors are taken into consideration. These include economic indicators such as employment data, GDP, manufacturing activity and cost of goods. Other factors, such as housing prices and the number of days a house spends on the market before it is sold, are also considered.

Another important factor that is taken into consideration is the number of building permits that have been issued. According to recent data, the number of building permits for residential construction being issued on the national level is on the rise, indicating builders are feeling confident about the health of the current housing market.

Analyzing Market Health According to Building Permit Requests

While it may not seem like an important factor to consider when analyzing the health of a housing market, building permit requests for residential construction are a strong indicator of market health.

First, if builders are putting in requests for residential construction, it means they are feeling confident that the market is stabilizing. After all, they would not invest their time and resources into a market that they feel is not viable. If developers are confident that the market is strong enough to build, they have likely conducted a great deal of research and have determined it is a good time to build.

An increase in building permits for residential construction is also a sign of a healthy market because it indicates there is a demand for housing in the area. Responding to this increased demand by constructing new residential properties makes it possible for more people to move to the area while keeping housing affordable. The more people who move in to an area, the better the outlook for the area’s economy.

Building Permit Requests for Residential Construction on the Rise

According to the Commerce Department, building permits for single-family houses on the national level were issued at a seasonally adjusted rate of 683,000. Permits for multifamily homes, which are defined as buildings with five or more units, reached 557,000. This means building permits for residential construction increased by 12 percent in May to an annual rate of 1.28 million. These figures represent the highest they have been since 2007.

While building permit requests were on the rise, the number of actual housing starts in May fell to an annual rate of 1.04 million. On the other hand, April housing start rates were quite strong and the May figures are still five percent higher than they were a year ago. Furthermore, the National Association of Home Builders recently reported that the builder’s sales outlook for June is the best it has been since 2005.

To learn more about national trends in real estate or to learn more about available Richardson homes, contact our team of knowledgeable real estate professionals today. We would be happy to provide you with the information you seek and will take the time to help you understand the data and figures so you can make the best real estate purchase possible.

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