– Construction of new homes in California continued to decline in October, prompting California homebuilders to call on state lawmakers to reexamine the benefits of the state new-home buyer tax credit enacted earlier this year in hopes of getting similar legislation passed to stimulate the housing sector and the economy, the California Building Industry Association reported.
“The housing industry is an integral part of the state economy and a leading economic generator in terms of job creation and economic output,” said Liz Snow, CBIA’s President and CEO. “Bolstering the housing sector would only help to foster a broader economic recovery.”
According to statistics compiled by the Construction Industry Research Board (CIRB), homebuilders pulled permits for 2,815 total housing units in October, down 6 percent from September, and down 33 percent from October 2008. Permits for single-family homes totaled 2,017, down 9 percent from the previous month and down 14 percent from same period last year, while multifamily permits totaled 798, up 5 percent from September but down 57 percent from a year ago.
During the first 10 months of the year, permits were pulled for 29,901 units, down 46 percent from the same period last year when 55,632 permits had been issued. Single-family units were down 30 percent while multifamily units were down 64 percent.
CIRB is forecasting permits will be pulled for just 36,000 total units in 2009, which would be by far the lowest total on record.
Snow applauded federal lawmakers for extending the federal first-time homebuyer tax credit while also adding a credit for move-up buyers, and encouraged California lawmakers to follow suit.
“We expect to see some positive momentum generated by the federal tax credit and we applaud federal lawmakers for taking swift action in approving the extension,” said Snow. “The state tax credit generated much positive momentum earlier this year by way of helping to generate new-home sales, and in turn, job-generating new-home construction. California lawmakers should reexamine these benefits and work to implement a new tax credit in hopes of continuing that positive momentum and encourage a broader economic recovery in the coming year.”
A table listing housing starts by type and by metro area is available here