Based on residential permit data compiled by the Home Builders Association of Southeastern Michigan (HBA) in Bingham Farms, a total of 308 single-family home permits were issued in Macomb, Oakland, St. Clair, and Wayne counties in November, according to the HBA/Carter Lumber Southeastern Michigan Residential Building Activity Report.
This pushes the streak of 300 or more single-family permits to 18 months, the longest such streak since November of 2006. Despite this, no multi-family permits were issued in November as previously permitted projects continued construction.
“Consistency in new home permits has been key to making 2021 successful for builders, even in the face of on-going supply chain challenges,” says Michael Stoskopf, CEO of the HBA. “It can be tough for builders if they cannot keep their trade subcontractor base consistently busy.”
Some factors Stoskopf credits with the continued strength of single-family home permits in 2021 to a scarcity of home inventory despite a strong buyer-demand. This can lead to some opting to buy new or build.
“When consumers cannot find what they are looking for, especially in a seller’s market where multiple bids and cash offers dominate, then buying a new home becomes a viable alternative,” he says. “This includes gaining the benefits of a new home as it relates to energy efficiency and negating the need to perhaps remodel immediately after purchasing an existing home.”
Regarding industry metrics the report factors into its projections, U.S. Department of Labor data for October (DoL data is delayed by one month) on the number of people employed in the four-county area increased by nearly 2 percent from September.
With this increase, employment in southeastern Michigan now is 1.6 percent below March 2020 numbers. The available workforce also increased from September and is now less than 2 percent below its level in March 2020.
Crude oil prices and North American vehicle production are not as promising. The price for one barrel of oil is up 18.9 percent from last month and 102.3 percent from last year. Vehicle production is down 4 percent month-over-month and 12.4 percent year-over-year.
The average value of a new single-family permit is up 18 percent month-over-month to $356,386, and 22 percent year-over-year. The average sale price of a single-family is $278,840, which is unchanged from last month, but up 9.1 percent year-over-year.
