Snapshot of Local HBA Economic and Housing Statistics

June 3, 2014

NAHB recently released an on-line tool that provides economic and housing statistics for all local associations.  The tool allows users to easily compare local area statistics to other associations, state and national figures. In addition to providing members with information on the local market, executive officers may find this tool helpful when responding to requests from local media.

The statistics provided are NAHB tabulations based on an aggregation of county-level data from the 2012 American Community Survey (ACS) and 2013 Building Permits Survey. The ACS and Building Permits Survey are conducted by the Census Bureau. The tabulations are based on the latest available data.

The NAHB tabulated statistics are discussed below.

Population – Population is a count or estimate of the number of individuals residing in the specified geography. The higher the rank, the higher the population compared to other HBAs.

Number of Owner-Occupied Housing Units – An owner-occupied housing unit is a house, an apartment, a mobile home or trailer, a group of rooms, or a single room that is occupied. A high rank indicates more owner-occupied housing units.

Homeownership Rates – The homeownership rate is calculated by taking the total number of owner-occupied units divided by the total number of occupied units. A high homeownership rate implies a low rental rate. A high rank indicates a high homeownership rate.  High home ownership rates are frequent in less urban areas, moderately priced areas and where fewer moves occur.

Homeowner Vacancy Rates – The homeowner vacancy rate is calculated by taking the total number of vacant units intended for owner-occupancy divided by the total number of owner-occupied and vacant units. A low vacancy rate indicates a tight housing market where demand for owner-occupied units is high relative to supply.

Single-Family Concentration – The share of homeowners living in single-family detached housing is calculated by taking the total number of single-family detached units divided by the total number of owner-occupied units. A high rank indicates a high concentration of single-family homes. Lower rates are typical of more urban locations with denser developments.

Value of Home Owned – The figure provides for all owner-occupied housing units the median home value. These figures along with income are critical components of housing affordability. The higher the rank, the higher the median value compared to other HBAs.

Income of Homeowners – The figure provides for all owner-occupied housing units the median income of the householder and all other individuals in the household. The higher the rank, the higher the median income compared to other HBAs.

Share of Homes Recently Built – The share of new owner-occupied units is calculated by taking the total number of owner-occupied housing units built since 2000 divided by the total number of owner-occupied housing units. The number indicates how fast the stock of owner-occupied housing is growing. The higher the rank, the higher the share of homes built since 2000 compared to other HBAs. Higher shares are indicative of faster growing, more recently developed areas while lower shares are signs of areas with slow or little growth.

Single-Family Permits Issued – The figure shows the number of building permits issued on new privately-owner residential construction for single-family housing units. The higher the rank, the more single-family permits issues compared to other HBAs. The number of permits per 1,000 population is another indicator of growth; the higher the ratio, the greater growth and growth potential.

Single-Family Permits Percent Change – The figure is calculated using the annual statistics for single-family permits issued in 2012 and 2013. The higher the rank, the higher the percent change in single-family permits issues from 2012 compared to other HBAs.

Multifamily Permits Issued – The figure shows the number of building permits issued on new privately-owner residential construction for multifamily housing units. The higher the rank, the more multifamily permits issues compared to other HBAs.

Multifamily Permits Percent Change – The figure is calculated using the annual statistics for multifamily permits issued in 2012 and 2013. The higher the rank, the higher the percent change in multifamily permits issues from 2012 compared to other HBAs.

Rank – The rank of the HBA in each category is out of a universe of 673.

In March 2014, NAHB published a special study allowing readers to compare local housing markets. The level of geography selected for that analysis is referred to as metropolitan area. The metropolitan area is also an aggregation of counties that share a local labor and housing market based on local commuting patterns. This tool complements the special study and is meant to provide another cut of the local housing market.

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Multifamily Starts: A Little Stronger than We Thought Last Month

March 21, 2013

For February of 2013, the Census Bureau’s preliminary estimate for starts in buildings with five or more apartments came in at 285,000  (at a seasonally adjusted annual rate).  In the Census construction report, this shows up as less than a 1 percent increase from January, but the January number itself was revised upward by nearly 9 percent—so 285,000 is  actually 9.6 percent higher than the preliminary starts rate for January originally reported in last month’s blog.

Feb 2013 MF Starts

Although well below the anomalous spike of December, the February 2013 five-plus starts rate appears strong compared to any other month from recent history (the same general pattern seen in total housing starts).

Another interesting statistic in the February 2013 construction report was the (seasonally adjusted annual) rate at which new five-plus permits were issued during the month.  The new five-plus permit rate increased  7.5 percent to 316,000—which at first may not seem terribly dramatic, but is up nearly 55 percent year-over-year and the highest the five-plus permit rate has been since July of 2008.

The number of unused previously issued five-plus permits remaining in the pipeline at the end of the month also remained relatively healthy at 47,700 (not seasonally adjusted)—up 2.7 percent from January and 46.4 percent year-over-year.  Overall, the permit numbers have been strong enough to support a five-plus starts rate as high as February’s 285,000 over the next couple of months.


Multifamily Production Falls Back to November Rate

February 21, 2013

The Census Bureau’s preliminary estimate of starts in buildings with five or more apartments for January came in at 260,000 (at a seasonally adjusted  annual rate).  As predicted in last month’s post, a rate well in excess of 300,000 proved too high to sustain.  In fact, the five-plus starts rate for December was revised upward, from 330,000 to 352,000—so the preliminary estimate for January shows up as a 26 percent decline, dropping the five-plus starts rate back to where it was in November.  Month to month fluctuations on this order of magnitude are not unusual in the multifamily construction series, however.

5-Plus Jan

On a year-over-year basis, five-plus starts were still up 35 percent, reflecting the generally upward trend in multifamily production that has prevailed since the end of 2010.

Meanwhile, the rate at which new five-plus permits were issued remained relatively stable in January, increasing 1 percent to 311,000—the third straight month the five-plus permit rate has been slightly above 300,000.  The rate of new five-plus permits usually runs a little above the rate of new five-plus starts (partly because of the Census Bureau’s tendency to reclassify some units considered multifamily by local permitting offices as single-family attached).  Nevertheless, the five-plus permit numbers in recent construction reports have been strong enough to suggest that a five-plus starts rate at slightly above 260,000 is sustainable over the short run.


Multifamily Production Rate Hits 4.5-Year High

January 18, 2013

In December, the (seasonally adjusted) annual rate of starts in buildings with five or more apartments increased by 23 percent from the revised figure for November, to 330,000.  The November figure was revised down substantially, but the big news is that the rate of multifamily production continues to climb, even after the large improvements it made in September and October of 2012—to the point where, at 330,000, the five-plus starts rate is now up 115 percent year-over-year.  Historically, this also marks the first time the monthly five-plus rate has been over 300,000 since June of 2008, shortly before the housing downturn hit the multifamily industry.MF_starts

Meanwhile, the rate at which new five-plus permits were issued in November declined by 1 percent to 301,000, while the backlog of unused permits in the pipeline increased by roughly 6 percent, to 46,800 (not seasonally adjusted).  Overall, the December permit numbers were strong enough to indicate that the five-plus starts rate is likely to remain relatively healthy in the short run, although a rate as high as 330,000 may be a little too much to sustain.


Apartment Production Stable at 4-Year High

December 20, 2012

In November, the (seasonally adjusted) annual rate of starts in buildings with five or more apartments was 285,000, according to the latest  release from the Census Bureau’s Manufacturing and Construction Division.   In the release this shows up as a 4,000 increase from October, but the five-plus starts rate for October was revised downward by 4,000; so the preliminary rate for November is exactly the same as the rate initially reported for October a month ago.  Irrespective of any revision, the five-plus starts rate has been relatively stable and over 280,000 for two consecutive months now—the highest this measure of apartment production has been since July of 2008.MF Starts

Although not as high as annual production during what many consider the “golden age” for multifamily housing (roughly 1997 through 2006), a five-plus starts rate of 285,000 is high enough to rank as one of the weaker golden-age months.

Meanwhile, the rate at which new five-plus permits were issued in November increased by 10 percent—largely offsetting the previous month’s decline and taking the five-plus permit rate back up over 300,000.  The backlog of unused, previously issued five-plus permits in the pipeline was also relatively stable in November, at 44,000 (not seasonally adjusted).  On balance, the November permit numbers indicate that, subject to the normal monthly fluctuations, a five-plus starts rate in the neighborhood of 280,000 is likely to be sustainable over the short run.


Production of New Apartments: Upward Trend Continues

November 21, 2012

In October, the previous month’s upward trend in multifamily production continued, as starts in buildings with five or more apartments came in at a (seasonally adjusted annual) rate of 285,000.  Although the line isn’t completely solid, buildings with at least five apartments are generally a reasonable way to draw a distinction between smaller “mom and pop” operations and  the province of professional property owners, managers and multifamily developers.

At 285,000, the Census Bureau’s preliminary five-plus starts rate for October was up 10 percent from September and up 63 percent year over year—illustrating how far the recovery in multifamily production has come from the historic trough of 2009 and 2010.  In fact, 285,000 is high enough to rank among the lower monthly five-plus starts rates recorded during what many consider to be a “golden age” of sustainable multifamily production (roughly 1997 through 2006).

Also in September, the rate at which new five-plus permits were issued dropped 10 percent, to 280,000, and the backlog of unused five-plus permits in the pipeline fell by 7 percent, to 42,600.  Both these permit numbers were up more than 40 percent year over year, however, so they aren’t a major sign of weakness (although a five-plus starts rate as high as 285,000 may be a little hard to sustain in the short run).


Apartment Production Numbers Hit 4-Year Highs in September

October 17, 2012

In September, the (seasonally adjusted) annual rate of starts in buildings with five or more apartments was 260,000, according to the latest release from the Census Bureau’s Manufacturing and Construction Division.  This is up 25 percent from August, and the highest the five-plus starts rate has been since September of 2008.  To illustrate how far the market has come from the recent historic trough, 260,000 is two and half times the total number of five-plus units started in either 2009 or 2010.

Also in September, the seasonally adjusted annual rate at which new five-plus permits were issued increased 23 percent to 323,000—the highest the five-plus permit rate has been since June of 2008.  The backlog of unused five-plus permits still in the pipeline at the end of September was 46,600 (not seasonally adjusted).  This is down fractionally from the August number, which was the highest the backlog of five-plus permits had been since early 2009.  The strong permit numbers are an indication that multifamily production is likely to be relatively healthy over the next few months, and that a five-plus starts rate as high as 260,000 may be sustainable.

For those interested in how much employment is being sustained by apartment production, the number of five-plus units under construction has been edging up steadily and at 226,000 is now the highest it’s been since October 2009.