BuildFax’s December 2019 Housing Health Report [1] found single-family authorizations fell 2.61% from November to December 2019, but increased 4.82% year-over-year. The three month outlook from October to December also grew 5.77%.
This is the consecutive month that the rolling three-month average is positive after showing declines most of 2019.
“The U.S. is facing a housing shortage, in part due to the slowdown in housing construction last year. This has been felt in both large metros and smaller cities across the country,” said Jonathan Kanare, Managing Director, BuildFax. “Now, even though the economy is showing strong growth and mortgage rates remain low, those who want to buy a new home are experiencing challenges with increased competition on a tight housing supply.”
Also seeing increase was the existing housing activity, as volume rose 9.47% and spending grew 16.26% year-over-year.
Remodel volume and spending—a section of maintenance that includes renovations, additions, and alterations—increased by 5.08% and 10.85%, respectively.
“These notable increases may be a result of homeowners feeling locked into their existing property. With interest rates low and the economy seeing strong growth, homeowners are facing increased competition in the housing market, especially as the housing stock dwindles. Consequently, instead of making a new home purchase, homeowners could be investing more in their existing property,” the report states.
One of the items that characterized the housing market over the past year was the slowdown in housing activity, which only saw an uptick over the final months of the year. Additionally, BuildFax states people may feel “locked into their existing home” due to increased competition for housing.
Just 10.1% of people in the U.S moved to a new home between 2017 and 2018—one of the greatest decades in mobility since 2008. Mobility fell to 9.8% as 2019 came to a close—the lowest reading since the metric was first tracked in 1947.