September Sees Gains in Single-Family Permits

 September 2020 brought a 10.2% increase over September 2019 in single-family permits issued year-to-date (YTD) according to the U.S. Census Building Permits. In fact, the report shows that over the first nine months of this year, the total nationwide climbed to 713,286.

As for each region of the country, the year-to-date ending in September varied. For single-family permits the Southeast saw the highest increase at 12.4%, the Midwest came in at the second-highest

with a 10% increase, the West had a 6.3% increase and the Northeast saw the smallest increase at 6.2%. Multifamily permits did not fair so great. Every region saw a decline with the biggest decline in the West at -9.4%, the Northeast had a decline of -7.5%, the South at -5.6% and Midwest had a decline of -2.7%.

Among the states, only 42 states had a growth in single-family permits while the remaining 8 states and the District of Columbia resulted in a decline. The record highest growth was seen in South Dakota from 2,186 to 2,885 making this a 32% increase. The District of Columbia saw the steepest decline with a 22.2% drop from 126 to 98.

The multi-family sector was not so lucky. YTD only 18 states showed growth while the remaining 32 states and the District of Columbia showed a decline. Mississippi had the biggest increase from 246 to 588 while New Hampshire had the largest decline from 1,148 to 386.

The top 10 metro areas with the highest number of single-family permits were:

Metropolitan Statistical Area	Single-family Permits: Sep (Units #YTD, NSA)
Houston-The Woodlands-Sugar Land, TX	35,309
Dallas-Fort Worth-Arlington, TX	31,631
Phoenix-Mesa-Scottsdale, AZ	22,566
Atlanta-Sandy Springs-Roswell, GA	20,013
Austin-Round Rock, TX	15,327
Charlotte-Concord-Gastonia, NC-SC	13,258
Tampa-St. Petersburg-Clearwater, FL	11,683
Orlando-Kissimmee-Sanford, FL	11,367
Nashville-Davidson-Murfreesboro-Franklin, TN	10,429
Washington-Arlington-Alexandria, DC-VA-MD-WV	9,933

The top 10 metro areas with the highest number of multifamily permits were:

Metropolitan Statistical Area	Multifamily Permits: Sep (Units #YTD, NSA)
New York-Newark-Jersey City, NY-NJ-PA	31,160
Houston-The Woodlands-Sugar Land, TX	15,967
Austin-Round Rock, TX	15,294
Los Angeles-Long Beach-Anaheim, CA	12,095
Miami-Fort Lauderdale-West Palm Beach, FL	11,994
Dallas-Fort Worth-Arlington, TX	11,862
Phoenix-Mesa-Scottsdale, AZ	10,717
Seattle-Tacoma-Bellevue, WA	10,580
Nashville-Davidson–Murfreesboro–Franklin, TN	8,256
Minneapolis-St. Paul-Bloomington, MN-WI	7,881

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2020 Is The Year For Millennial Home Buyers

“After a decade of cocooning, millennials want to buy homes that represent value, which is in keeping with the way they shop for everything else,” CNBC’s Jim Cramer said. “The delay in … homebuying is over, the spending is just beginning.”

The year 2020 will bring a new era to dominate the housing market. According to CNBC.com, ” Millennials are expected to be the largest single cohort of homebuyers in 2020.”

“People who have jobs and feel confident in the future are taking advantage of affordable luxury

wherever they can find it,” Cramer said. “I think that gives you great insight into the behavior of millennials, or at least the millennials who have money to spend.”

This generation, born between 1981 and 1997, make up around 33% of the homebuyers which is up from 20% just five years ago.

“In fiscal year 2019 over 20% of our closings had one purchaser 35 years old or under,” CEO of Toll Brothers Doug Yearley said.

Toll Brothers is the nation’s leading builder of luxury homes. The company builds in 23 states and the District of Columbia. The company had a strong fourth quarter in 2019. They reported earning $1.41 per share on revenue of $2.38 billion. Toll Brothers sold 2,672 units in home sales that totaled $2.29 billion in a three-month period.

Toll Brothers is focusing its affordable luxury communities on move-up, active adult and millennial

buyers. The older more affluent millennials have been the biggest factor in this decision.
“This market is strong and demographics suggest it will grow over the next decade as millennials mature,” Yearley said.

Another big homebuilder, Taylor Morrision, agrees that millenials are on an upward trend when it comes to homebuying. The homebuilder, which builds in nine states among the south, southwest and midwest regions, reports that a good majority of their homebuyers are millennials.

“People who have jobs and feel confident in the future are taking advantage of affordable luxury wherever they can find it,” Cramer said. “I think that gives you great insight into the behavior of millennials, or at least the millennials who have money to spend.”

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