More good news for the Japanese housing market. While still down over the previous year, the starts for March came within 2.4% of the 2009 figures. This is in large part due to an unexpected jump of 8.8% in condominium sales. This represents the first rise in condo starts in 16 months. As long as this is not just a single month blip, strength in the condo market will help put the entire housing market onto a solid footing.
Not to be outdone, 2×4 starts surged ahead by 16.8% for the month! What was particularly impressive about this jump was that it wasn’t just due to rental units (up 20.1%). Single family homes were up 9.8% and spec housing was up 19.1%. Post and beam also had a strong month with starts increasing by 7%. Overall, wood housing starts were up 8.4%. It seems that wood is good these days!
These numbers are also confirming what I have been hearing from people in the wooden housing industry. Developers have been telling me that spec housing in certain areas of Tokyo is strong and industry people in general are optimistic that this year will see a significant turn-around over last. I also just met with an industry newspaper reporter who said he has been hearing the same thing from pre-cutters across Japan. He also suggested that the fierce price competition might be coming to an end as enough builders have gone out of business to relieve some of the excessive capacity that has existed here for years. It is sad to see people lose their jobs or companies, but for the sake of a profitable and healthy industry such a realignment was probably necessary.