Housing production in California was up in November for the fourth consecutive month. But builders in the Golden State are still on track to start the third lowest number of units on record in 2011.
According to the Construction Industry Research Board, 4,011 housing permits were issued in November, a 21% increase from the same month a year ago and a 51% jump from October.
Permits were issued for 1,486 single-family houses, up 4% from November 2010 but down 1% from the previous month. Multifamily permits totaled 2,525, a 33% gain from a year ago and a huge 123% leap from October.
For the first 11 months of the year, permits were pulled for 41,123 total units. That's a welcome 8% increase compared to the same period in 2010, when 38,074 permits were issued. Permits for single-family homes were down 12% for the period, but multifamily permits were up 36%.
Mike Winn, president of the California Building Industry Association, called the November figures “heartening.”
“We do seem to be recovering, albeit at a very slow rate which is not enough to signal any meaningful impact on jobs or the economy,” Winn said.
The research board is still projecting a total of 46,000 residential permits for the year, which would make 2011 the third worst year since it began tracking permits in 1954. The all-time low was set in 2009, when a total of 36,421 permits were taken down by builders. The second-lowest year was 2010, when 44,762 permits were issued.
“These past few years have taken a massive toll on our state's employment rate and economy,” Winn said. “Hopefully this trend of increased production over the past four months is a sign of better times to come in 2012.”
In other multifamily news, although residential originations fell by 20% in the third quarter — compared to the same period last year — multifamily production went in the opposite direction, rising 80%, according to figures compiled by ASR sister publication National Mortgage News (NMN) and the Quarterly Data Report.
However, the results are incomplete to some degree because some firms including Wells Fargo & Co., would not disclose their production figures in this category. Still, some of the firms that participated in NMN's survey had stellar results. CitiMortgage, for instance, originated $523 million in multifamily mortgages, a 69% jump from 3Q10. (Citi's parent is headquartered in New York City, arguably the nation's best rental market for landlords.)
Other standouts include Flushing Savings Bank, Lake Success, N.Y., which saw production rise 58%, and Bank Mutual Corp., Milwaukee, Wisc., which experienced a 67% rise in multifamily. But not all lenders flourished. TD Banknorth, Fallmouth, Me., saw fundings decline by 30% to $71 million. The boom in production does not come as a total surprise.
Over the past three years, the nation's foreclosure crisis has turned millions of former home owners into renters. This in turn has fed a strong rental market, one that has caused multifamily housing starts to rise dramatically.
