The housing market is in trouble. We know this. And the Chicago real estate market isn’t immune to its troubles. We know this, too. Yet hearing about housing market woes on the news can start to feel cumbersome and depressing after a while. So here’s a bit of good news to lift our spirits, and to remind us that the Chicago real estate market will bounce back.
This week, the Department of Commerce released housing data for the month of April, and while overall housing starts dropped by 12.8 percent since March to an annual rate of 458,000 new homes, construction of single-family homes were up 2.8 percent to 368,000.
This is the second consecutive month that single-family home starts saw a increase, which many see as a sign that the residential construction industry is starting to recover.
“With some of the best home-buying conditions of a lifetime now in place – including historically low mortgage rates, affordable prices and a first-time home buyer tax credit – single-family builders are starting to see the light on the horizon as more consumers realize they can now obtain the home of their dreams,” said Joe Robson, chairman of the National Association of Home Builders, in a press release.
Furthermore, the issuance of single-family permits rose 3.6 percent to 373,000 units, which indicates that this upward turn will only continue.
According to the Wall Street Journal, economists believe that single-family construction data are the best way to determine the viability of the housing market. In addition, builders see new construction as a reliable indicator that the real estate market is bottoming out.
In contrast, multi-family home starts decreased 46 percent to 90,000, an all-time low, and permits fell almost 20 percent. Overall new-home construction dropped 21.4 percent in the Midwest.
The housing market hasn’t completely recovered, but these single-family home construction figures shed some light on an otherwise ominous picture.