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CBIA: Housing Production Continues Decline in February
California homebuilders hope tax credits will help industry begin recovery
Housing production continued to decline in February, the California Building Industry Association announced today, but CBIA officials were optimistic as builders reported increased traffic at sales offices in recent weeks and cited the recently enacted state and federal tax credits as the primary cause.
According to statistics compiled by the Construction Industry Research Board, just 2,298 permits were pulled throughout California during the month of February, down 66 percent when compared to the same month a year ago, but up 15 percent from January.
A table listing housing starts by type and by metro area is available here.
Robert Rivinius, CBIA’s President and CEO, said the grim housing starts numbers prove once again the need for the $10,000 state tax credit for buyers of new homes that was included in the state budget package, along with the $8,000 federal first-time buyer tax credit enacted by Congress.
“We once again want to thank the Legislature and Governor Schwarzenegger for enacting the state tax credit as we have been hearing reports from builders saying that there is already an increase in traffic at their sales offices due to the credit,” Rivinius said. “We are hopeful that sales will continue to increase over the next few months, helping to restore consumer confidence, clear out inventory, and get job-generating home construction back to healthy levels which will go a long way towards reinvigorating our economy.”
In February, single-family permits totaled just 1,261, down 50 percent from February 2008 and down 0.2 percent from January, while multifamily permits totaled 1,037, down 76 percent when compared to February 2008. February’s multifamily total was up 41 percent from January, when only 736 permits were pulled.
For the first two months of the year, permits were pulled for 4,298 units, down 63 percent when compared to the first two months of 2008 when 11,531 permits were issued. Single-family permits were down 52 percent while multifamily permits fell 72 percent.
CIRB is now forecasting 50,000 total units for 2009 which would be by far the lowest total on record, down 23 percent from the record-low 64,752 units produced in 2008.
“After hearing preliminary reports of increased sales traffic from local builders, we believe the tax credits are doing their job in attracting buyers and we remain hopeful that this will have a positive impact on homebuilding,” Rivinius said.
The California Building Industry Association is a statewide trade association representing thousands of homebuilders, remodelers, subcontractors, architects, engineers, designers, and other industry professionals. More information is available on the Association's Web site, www.cbia.org.
The Construction Industry Research Board (CIRB) is a nonprofit research center established in 1974 to provide statistical information on the California building and construction.