The number of new homes being built in any particular area is a good indicator of how well the local housing market and economy are doing. In short, when the economy is up, more new homes will be built because there will be more people looking to buy. Because of this, the U.S. Census Bureau and the Department of Housing and Urban Development track new residential construction numbers each month. According to their most recent release, the number of single-family homes that began construction during the month of January was down 3.9 percent from the month before. The drop was unexpected but appears to be due to harsh winter weather in the Northeast. In fact, a closer look at the numbers shows the region suffered a 14.1 percent slide, while the South and West – where weather is less of a factor – were essentially flat from one month earlier. In addition, building permits, which are a good indictor of future housing starts, were also relatively flat from December’s numbers. Because the decline was likely due to heavy snowfall during the month, analysts expect the downturn to be temporary. More here.
New Home Construction Down In January
