Report: Metro Detroit Mid-year Home-building Permits Are Down Nearly 27% Over 2018 Activity

Continuing a slowdown that started in January, a total of 330 single family home permits were issued in June in Macomb, Oakland, St. Clair, and Wayne counties, according to residential permit data released today by the Home Builders Association of Southeastern Michigan (HBA) in Farmington Hills.
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Detroit home building permits
A total of 330 single-family home-building permits were issued in Macomb, Oakland, St. Clair and Wayne counties in June. - (Photography) courtesy of Getty Images

Continuing a slowdown that started in January, a total of 330 single family home permits were issued in June in Macomb, Oakland, St. Clair, and Wayne counties, according to residential permit data released today by the Home Builders Association of Southeastern Michigan (HBA) in Farmington Hills.

June’s permits bring the year-to-date total to 1,922 for 2019, which is down nearly 27 percent from the first six months of 2018 (2,626). The slowdown in permit activity varies based on the volume of the builder.

The Top 7 builders with respect to the number of permits pulled are down only 5 percent for 2019. Compare this to the remainder of the region’s builders: as a group, their permit activity is down by more than 36 percent compared to 2018.

“The slowdown in new home construction permit activity in 2019 is quite dramatic, especially when compared to existing home sales which are also down but only by about 1 percent according to REALCOMP data,” says Michael Stoskopf, CEO of the HBA.

“Weather impacts earlier in the year are partly to blame but rising construction costs, trade subcontractor availability, and higher mortgage interest rates (which are now declining) have all had an impact on new home construction activity in the first half of 2019.”

Stoskopf adds there are other economic factors that are positive, including: 30-year fixed mortgage rates at their lowest level since January 2018; continued, steady growth in the number of people employed, and a steadily growing workforce, both averaging their highest levels since 2006.

Pulte Homes was the most active area builder in the first half of 2019 with 259 permits. Pulte was followed by Lombardo Homes (165), Nino Homes (85), Robertson Bros. (81), and M/I Homes of Michigan (70).