This is something that is hard to convey when people see how anemic housing is and how many problems there are in the market. However, measured by the absolute growth of housing permits issued, growth is now back to where it was during the boom.
That seems crazy?
However, first permits are going to be a little more steady than starts and of course lead starts. This is because when you break ground might depend on lots of different temporary factors. Also, while the seasonal flux in permits is strong its not quite as bad as starts.
Second, and more important, the contribution to growth comes from the absolute change. So, going from nothing to really crappy can be a strong contributor to growth. Just as going from a boom to normal can be a strong drag on growth.
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Thursday ~ April 26th, 2012 at 4:38 pm
curtd59
But do you think it WILL break, or continue at the current pace?
Because I can’t see a reason for it to do anything other than reach some level that absorbs the people heavily invested in the industry, and that those permits should be widely distributed across the developing areas of the country rather than subject to regional concentrations.
I’m with Schiller on this. I just don’t see us getting out of anemic growth no matter what we do.
Thursday ~ April 26th, 2012 at 4:47 pm
michelle
It appears to be back to the same general range that it’s been in since recovering from that pesky S&L scandal thing back in the early ’90′s.
Are you saying you see the Confidence Fairy returning to construction?
Thursday ~ April 26th, 2012 at 6:50 pm
Lord
Hmmm. They were back there two years ago. No place to go from here?
Thursday ~ April 26th, 2012 at 7:07 pm
rjsigmund
they cant mean much, karl, cause 2011 was the all time low year for starts, less than even the 60s
Thursday ~ April 26th, 2012 at 8:30 pm
michelle
True, but the rate of change is back to its former level. So even though the total current number is quite small, it’s increasing at a rate (in number) similar to the 15 years prior to the crash.
This would seem to indicate that builders are more confident that what they build will either be sold at a profit, or that they’ll be able to at least refinance the loan they took out to build at a comparable rate to the original.
I wonder which one it is.
Friday ~ April 27th, 2012 at 3:02 am
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