BuildFax’s January Housing Health report found that single-family housing authorizations fell month-over-month in January 2020 by 0.41% but remain up year-over-year by 6.03%.
The report says the existing-housing activity rose in January. Existing maintenance and spending grew by 5.67% and 8.61%, respectively, year-over-year. The remodel volume and spending increased by 2.02% and 3.53%, respectively, year-over-year.
“Housing activity has started on strong footing this year, which should be welcome news for the broader economy. The housing market, which accounts for a substantial portion of U.S. GDP, has the potential to drive increased growth, providing a balance to any concerns of a sluggish market heading into 2020,” said Jonathan Kanarek, Managing Director, BuildFax. “While we’re still experiencing some growing pains regarding the recent housing shortage, as more inventory becomes available, we might see the housing market growing at an even faster pace.”
While the report finds housing activity is off to a good start in 2020, the most-populated cities tell a different story.
On a yearly basis, new construction—including both single-and multifamily housing authorizations—decreased across almost all major metros year-over-year. Just three metros—Chicago, Philadelphia, and New York—experienced increases.
Chicago reported growth of 2.14%, Philadelphia recorded an increase of 14.33%, and New York had the largest increase at 57.23%.
New construction fell by 13.33% in Miami—the largest drop in the nation. Also reporting declines were: Los Angeles (-5.74%); Dallas (-8.40%); Houston (-3.43%); Washington, D.C. (-3.66%); Boston (-5.38%); and Atlanta (-0.14%).
BuildFax found that just Miami and Houston recorded declines in maintenance activity, at 10.86% and 3.44%, respectively. The report states these declines may be the long-term effects of 2017’s Hurricanes Irma and Harvey.
“The healthy growth in maintenance activity is a good sign for the broader economy because this could also be attributed in part to homeowners prepping their property for resale. As the housing stock dwindles and home prices skyrocket, an increase in existing-home sales would help ease some of the shortage concerns,” the report says.
On the heels of this report, the Mortgage Bankers Association (MBA) revealed mortgage applications for new-home purchases rose year-over-year by 35.3% in January 2020. Applications rose 40% month-over-month.