Home builders in Allen and surrounding counties are ahead of last year’s permit numbers for the first six months, but are still just a hair short of 2013’s same period totals.
The Home Builders Association of Fort Wayne clocked 548 new home permits in the first six months of this year, compared to 475 in the same period of 2014 and 551 in the first six months of 2013 in Allen, Adams, DeKalb, Huntington, Wells and Whitley counties.
The lion’s share of the permits were issued in Allen County, which accounted for 410 this year, a big step up from last year’s 339. The low point for Allen County was in at the beginning of the recession-based slump in 2008, when only 284 permits were issued. The low point for the region as a whole was in 2009.
Again this year, low mortgage rates are helping builders attract customers, said Lonnie Norris, vice president of sales for Granite Ridge Builders. Buyers are able to spend more as a result, and the company’s average home price of about $250,000 is up from last year.
“We would say the market is strong. I think there’s a sort of overall optimism that jobs are stable,” he said.
Granite Ridge was the second most prolific builder in the area served by the HBA, with 64 permits issued, but led in dollar volume with a total of more than $15.8 million. The company also builds a lot of homes outside of the six-county area – in Goshen, for example, which is now 20 to 25 percent of its business – and its overall total is actually down slightly from a year ago.
But July is off to a good start, and may set a record for the best July Granite Ridge has ever had, Norris added.
Lancia Homes was the area’s busiest builder in the first half of the year, permitting 79 new homes with a total value of $14.1 million.
Timberlin Homes topped the HBA’s list in terms of average permit value. Although the company only obtained permits for six homes in the first half of the year, the average value of each home was $462,102.
Rain didn’t really slow the pace of new home buying or actual construction in May and June, but has delayed site development because the ground is so muddy. Some popular areas, such as Perry and Aboite townships, are running low on lot space, so there is a need to open new areas for development, Norris said.
Chad Korte, president of Home Lumber in New Haven, said lumber sales there are about even with last year, but would be much better if the rain wasn’t so heavy. Builders put in basements that flood, or can’t get footers in place, and that delays the purchase of lumber for the houses.
“I don’t think it will be lost sales, I just think there will be a big rush to catch up,” he said.
About 95 percent of Home Lumber’s business is tied to new home building, Korte said.
According to April estimates from the National Association of Home Builders, the one-year impact of building 100 new single-family homes in a typical locale include $28.7 million in local income, $3.6 million in taxes and other revenue for local government and 394 local jobs. The ongoing impact of building that same 100 homes includes $4.1 million in local income, $1 million in taxes and other revenue for local governments and 69 local jobs.
The NAHB’s model projects the effect of the construction activity itself, the ripple impact that occurs when income earned from construction activity is spent and recycles in the local economy and the ongoing impact that results from new homes becoming occupied by residents who pay taxes and buy locally produced goods and services. However, the impacts were calculated assuming a value for new single-family homes that is higher than the average of homes built in the northeast Indiana.