Based on residential permit data compiled by the Homebuilders Association of Southeastern Michigan in Bingham Farms and reported in the HBA/Carter Lumber Southeastern Michigan Residential Building Activity Report, 369 single-family home permits were issued in Macomb, Oakland, St. Clair, and Wayne counties in September 2021.
The HBA’s econometric model forecasted 270 permits to be issued, meaning expectations were exceeded by 37 percent. September also extends the streak of 300 or more permits to 16 months, the longest streak since November 2006.
“The extension of the 300+ permits per month streak is significant in that it indicates both a sustained demand and a sustained ability to construct new single-family homes,” says Michael Stoskopf, HBA’s CEO.
“That said, ongoing supply chain challenges, typically reflected in increased material and labor cost inputs to new home construction, have resulted in the average new home permit value being over 13 percent higher than in September 2019, as a pre-pandemic comparison.”
Multi-family permits added another 128 permits in the month, bringing the year-to-date total to 1,880 permits. This is the best start to a year for multi-family permits since the first nine months of 1998.
The average value of a new single-family permit was $290,485 in September, down 2.9 percent month-over-month and 1.3 percent year-over-year. The average sale price of a single-family home was $289,459. This was an 11.7 percent year-over-year jump and an insignificant increase of 0.4 percent month-over-month.
The economic factors which the HBA uses as part of its forecasting method had mixed results. The U.S. Department of Labor data from August (DOL data is delayed a month) on the number of people employed grew at a modest rate from last year, but effectively held steady from July.
The available workforce — 1.9 million — dropped since by 3.1 percent from one year ago and held steady from last month. North American vehicle production also declined by 17.7 percent in September and more than 30 percent from last year. Crude oil prices dropped from August’s close but remain 46 percent higher than September 2020.