New home construction numbers aren’t the first thing prospective home buyers check when thinking about buying a home. Current listings, home prices, and mortgage rates are more likely starting points. But the number of new homes being built affects buyers, whether they know it or not. For one, the pace of new home construction can help moderate price increases, as more new homes add to overall supply, which reduces competition and limits price spikes. In other words, if more new homes are being built, it’s good for buyers whether they are shopping for a new or an existing home. So what’s happening in the new home market these days? Well, according to the latest numbers from the U.S. Census Bureau and the Department of Housing and Urban Development, new residential construction fell in January. A large share of the downturn was due to declining multi-family construction. Single-family home construction was also down but the number of permits authorized to build new homes increased 1.5 percent from the month before. Rising permits are an indicator of future construction numbers which means the increase could be a sign that winter construction declines may soon turn into gains as spring approaches. (source)
