Housing construction is slowly ramping up. Housing starts and permitting have been at their strongest levels in years, with many markets exhibiting double-digit increases between 2011 and 2012.
Construction is an important source of job creation, but may also be needed soon to quench supply/demand imbalances in certain local markets. Through construction has grown relative to 2011, it remains tame compared to pre-recession levels.
Boise City, for example, saw a 78% increase in permits for construction between 2011 and 2012. Permits in 2012 were 72% lower than in 2005, though.
This trend of rising permits is also important as it signals confidence on the part of builders who have been reluctant to start projects in the face of large inventories and tight lending.
Ken Fears is the Manager of Regional Economics and Housing Finance Policy. He focuses on regional and local market trends found in the Local Market Reports and the Market Watch Reports . He also writes on developments in the mortgage industry and foreclosures.