Homebuilders squinting to see that elusive light at the end of the tunnel will find little sunshine in the latest set of numbers.
According to the latest Keystone Report, which tracks homebuilding permits in the 13-county area, new home construction is tailing off again. In August, metro-area cities have issued 246 permits for 460 new housing units, down from the same four-week period in August 2009 (263 permits for 541 units).
The total value of the August permits is $92.1 million, down from $92.8 million a year ago.
Year-to-date numbers through August (1,980 permits for 3,193 new housing units) still look good compared with last year (1,442 permits, 2,308 housing units), but much of the 2010 activity was driven by now-expired government incentives; a federal tax rebate for home purchases expired in April
The Twin Cities’ numbers are part of a national trend. With the economy struggling to gain its footing, and the job market still looking bleak, consumers lack confidence to make big purchases.
Lumber mills are reacting to the market. A handful of sawmills in Oregon and Montana reduced or ceased production in August “due to market conditions,” according to Eugene, Ore.-based Random Lengths, which tracks the wood-products industry.
Lumber prices are now down to about the same levels seen in 2009, when the homebuilding recession was at its low point.
Composite lumber prices crept as high as $357 per 1,000 board feet in April, but have since dipped back down to $244 – only $6 more than they were last year at this time, noted Random Lengths editor Shawn Church.