California housing starts decline

January 7, 2004

Permit fee increases cut single-family construction by nearly 28% in November

Inman News

California housing production, as measured by the number of building permits issued, declined in November, as builders used permits obtained in advance of fee increases earlier in the year, the California Building Industry Association announced Monday.

In November, home builders began construction on 9,314 single-family homes statewide, down 27.7 percent from October but essentially unchanged from November 2002, according to figures supplied by the Construction Industry Research Board in Burbank. On a seasonally adjusted basis, single-family production was up 1.4 percent from October and up 5.8 percent from November 2002.

Including multifamily production, builders began work on 13,049 homes and apartments in November, down 35.3 percent from October and down 3.6 percent from November 2003.

But despite the drop off, builders were all but certain to begin construction on more new homes and apartments in 2003 than in any year since 1990. Still, Robert Rivinius, CBIA's chief executive officer, warned that state and local policymakers can't be complacent about the relatively strong production figures.

"Although it's virtually certain that when the final numbers are in, 2003 will have been the best year for new-home construction since 1989, the fact remains that production is still far short of the need for new housing, and officials at both the state and local level need to make housing a top priority for 2004," Rivinius said.

But for the year, total production during the first 11 months of 2003 was 178,945, up 15.2 percent from the previous year and more than the total production level of 167,761 recorded in all of 2002.

For the year, CIRB now projects that total housing starts will be 191,000, the most since the 237,747 reported in 1989.

Total housing production increased in 20 of the state's 25 metro areas – 18 areas saw increases in single-family homes and 19 reported increases in multifamily units. The largest total-unit increases were reported in the Inland Empire, up 7,802 homes and apartments; the San Jose area, up 3,033; and the East Bay (near San Francisco), up 2,616.

The California Building Industry Association is a statewide trade association representing nearly 6,000 home builders, remodelers, subcontractors, architects, engineers, designers and other industry professionals.

Copyright: Inman News Features

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