May 19, 2009 – (RealEstateRama) — Local single-family building permits jumped 29 percent in April from last month, according to statistics compiled by the Home Builders Association of Greater Kansas City (HBA). A seasonally adjusted total of 144 single-family homes were permitted in April, up from a total of 112 homes permitted in March.
The increase in new-home construction is the latest in a series of reports suggesting the housing market may be turning around. Last month the Kansas City Regional Association of Realtors reported new-home listings fell below 3,000 homes, the lowest inventory total since June 2002. Last week the National Association of Realtors showed pending home sales nationwide rose for the second-straight month while affordability improved to near record highs. Plus last month’s Gallup Poll showed 71 percent of American said now is a good time to buy a home, an 18-point increase from a year ago and the highest level in four years.
All of this is good news for home builders, said HBA Executive Vice President/CEO Tim Underwood.
“The key ingredient missing from the recovery of the housing market has been consumers buying homes,” Underwood said. “Affordability is at its peak, inventories are dwindling and the combination of low mortgage rates and the $8,000 first-time homebuyer tax credit are bringing buyers backing into the market.”
Underwood said home builders were also applauding the decision this week to allow consumers to use the $8,000 first-time home-buyer tax credit for down payment and closings costs on FHA-insured mortgages. The measure allows FHA-approved lenders, government agencies and FHA-approved non-profit organizations to provide short-term loans up to the amount of the credit. The loan would then be paid back using the credit, which the buyer can obtain by filing an amended 2008 tax return or on their 2009 taxes. The Missouri Housing Development Commission was the first in the nation to offer short-term loans to buyers using the tax credit.
“Allowing FHA borrowers to use the tax credit at time of closing for down payment and other costs is a huge boost to the housing market and a tremendous benefit for buyers,” Underwood said. “The biggest obstacle most buyers have is putting together the required down payment. Builders have strongly urged the federal government to allow buyers to use the tax credit at closing, and this should further boost the housing market. The $8,000 tax credit is the biggest benefit of the stimulus package for the average taxpayer and this will allow more buyers to take advantage of the credit.”
Kansas City, Mo., led the list of top-permitting cities through April with 171 single-family homes permitted. Olathe ranked second with 76 units, followed by Kansas City, Kan./Wyandotte County with 32 and Gardner with 24. Rounding out the top ten were Leavenworth with 23 homes; Overland Park, 21; Blue Springs, 16; Shawnee, 15; Platte County, 14; and Lee’s Summit, 13.
The Home Builders Association of Greater Kansas City (HBA) is the voice of the housing industry and the source for housing information. Comprising more than 1,000 member companies, the HBA represents an industry that contributes more than $2.5 billion to the Kansas City economy and supports more than 36,000 jobs in the Greater Kansas City metropolitan area.