New home construction lags — but not in these four cities

Aly J. Yale
The Mortgage Reports contributor

Need a new home?

Thinking of buying a new house in 2019? Chicago’s your best bet. According to new data, the city saw the biggest surge in new home construction last month, with a 60 percent uptick year over year.

Verify your new rate (Feb 26th, 2020)

A Windy City windfall

According to the recent Housing Health Report from BuildFax, Chicago has seen the country’s biggest annual jump in new construction. Construction in the city — which includes both single-family and multi-family housing authorizations — increased 60.15 percent over February 2018.

The jump is likely due to Chicago’s recently approved five-year housing plan, which is designed to combat affordability concerns in the city.

Other cities that have also seen big increases in new construction are New York (up 51.37 percent over the year), Washington D.C. (up 25.9 percent) and Dallas (up 5.06 percent).

As the report explains, “It’s yet to be seen whether housing activity in these cities will eventually slow as it has on a national level or if these will be key metros to watch as the U.S. potentially heads towards an economic slowdown.”

Construction jobs on the rise: Will housing inventory do the same?

Big dips in Boston

Overall, the nation has seen a 5.75 percent in new construction, according to BuildFax’s report.

Boston claims the nation’s biggest decrease in new home construction, with a dip of 46.48 percent over the year. Atlanta also saw a big decline in construction, with a decrease of 32.66 percent since February 2018. In Miami and Los Angeles, new construction slowed by nearly 31 percent.

With construction down, homeowners are investing in their properties and staying put

According to Holly Tachovsky, CEO at BuildFax, it’s not all bad news for these cities.

“There have been persistent declines across key housing indicators for four consecutive months. However, we anticipate some economic relief as we head into 2019’s spring home-buying season,” Tachovsky said. “Mortgage rates have reached recent lows leading to increased potential for home sales, which is oftentimes followed by a surge in remodeling activity. The performance of single-family housing authorizations, maintenance and remodeling activity through this next season will shed light on whether declines in the housing market will spread to the broader economy.”

Verify your new rate (Feb 26th, 2020)

Get today’s mortgage rates

Are you thinking of leveraging new home construction in your city? Then shop around and see what mortgage rates you qualify for today.

Verify your new rate (Feb 26th, 2020)