The number of single-family residential building permits issued in February in Macomb, Oakland, St. Clair, and Wayne counties dropped to 264 units from 335 units a year ago but are expected to rebound to more than 330 units in March, according to the Home Builders Association of Southeastern Michigan in Farmington Hills. The region’s cold and snowy conditions were cited as the cause for the dip.
In February 2015, the last time weather impacted building permit data, there were 195 permits issued. The difference between 2015 and 2019, the association says, is an improvement in the overall economy.
“The leading positive economic indicator, with the highest correlation, is the number of people employed in our four-county area,” says Michael Stoskopf, CEO of the HBA. “It’s relatively simple: To buy a new home, you have to have a job. We are back to our highest level of employment since December 2006. With the trailing 12-month average employment also at its highest level since that time, the conditions are prime for renewed permit activity … at least once the weather breaks.”
Other leading factors in the forecast include year-over-year increases in the number of people employed (3.3 percent), labor workforce (3 percent), and a decline in crude oil prices (-17.2 percent).
Additional good news on the housing front is the average price of a single-family home increasing 4.6 percent to $205,647 and the average value of a new single-family permits gaining 12.6 percent to $304,068.
One economic factor tugging the local economy downward is North American vehicle production, which fell 5.8 percent compared to a year ago, according to Ward’s Automotive.