March New Construction Activity Jumps 48 Percent
In March, there were 627 building permits issued for single-family detached homes in the Denver area. This is a 48.6 percent increase from 422 in March 2012, according to a report by the Home Builders Association of Metro Denver. Builders pulled 1,614 permits in the first quarter, up 54 percent from the first quarter 2012.
Richmond American Homes led the builder community with 324 permits in March, and D.R. Horton was second with 138 permits. Today’s historically low interest rates and our inventory shortage are fueling the surge in new construction sales. There is less than a 2 month supply of resale homes in the Denver Metro real estate market.
Because of the increased demand, most Builders are not offering home buyers the financial incentives negotiable several years ago. The once popular $20,000 credit toward design center upgrades and/or closing costs is gone.
Experts predict we will see close to 7,500 permits issued this year, compared to 5,500 last year. Prior to the housing bubble, more than 15,000 permits were pulled a year.
The HBA report also showed apartment building activity was up 467 percent in March, with 442 multifamily permits issued, compared to 78 in March 2012. In the first quarter, apartment permit activity increased 153 percent.
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