Monthly new-home starts are up 25 percent since reaching a low of 217 single-family permits in May. That surge together with steadily decreasing inventory levels is a positive indicator that the local housing industry is showing signs of moving forward from the recent slowdown. With the recent housing stimulus package signed into law providing up to $7,500 in tax credits for first-time homebuyers, the market could now begin attracting consumers who have been waiting to make a homeownership investment at the ideal time.

“ Between low mortgage rates, competitive prices and now the new tax credits, we’re experiencing a very positive market for new-home consumers,” said HBA Executive Vice President/CEO Tim Underwood. “The vast majority of new-home construction in 2008 has been fueled by custom home building and presold homes. We expect to see more sales coming from the speculative market in the months ahead.”

For consumers attempting to time the market, Underwood said now may be the time.“ An instinct of many consumers in a down market is to time their purchase to the absolute best moment. Unfortunately, most people who try to time the market usually miss and wait too long,” Underwood said. “With the Federal Reserve looking closely at inflation and fears interest rates may rise combined with the rising costs of new-home materials and construction costs, we expect the next few months to be very attractive to buyers who make a move before prices and interest rates rise.”

A total of 2,071 single-family permits have been issued in 2008 through July, along with 1,397 multifamily units. That nearly doubles the number of multifamily units permitted a year ago and is the highest total of multifamily activity since 2001. Combined housing starts metrowide are down 29 percent from a year ago.

“ We’re continuing to see strength in the diversity of housing choices being built in the market,” Underwood said. “We have experienced very strong growth among multifamily rental homes this year and are currently in a multifamily expansion mode. That’s good news for consumers, especially those who have been priced out of the housing market due to high cost for new homes as well as a shortage of housing choices in some communities.”

Kansas City, Mo., led the list of top-permitting cities through July with 458 single-family home starts. Olathe ranked second with 250 units, followed by Lee’s Summit with 106 and Kansas City, Kan./Wyandotte County with 103. Rounding out the top ten were Overland Park with 89 units; unincorporated Platte County, 83; Blue Springs, 74; Independence, 69; Shawnee, 69; and Raymore, 66.

The Home Builders Association of Greater Kansas City (HBA) is the voice of the housing industry and the source for housing information. Comprising more than 1,000 member companies, the HBA represents an industry that contributes more than $2.5 billion to the Kansas City economy and supports more than 36,000 jobs in the Greater Kansas City metropolitan area.