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New Year, New Homes, New Statistics

According to the latest report released by the Commerce Department, 2005 will go down as a record year for new home construction. What can we expect for the New Year? It may not be as strong as the record breaker 2005, but 2006 will keep builders and Certified New Home Specialists™ very busy.

National Association of Home Builders Chief Economist David Seiders noted that 2005 was a banner year, “total U.S. housing starts for the year 2005 topped 2.06 million units, which is up 5.6 percent from 2004 and the second-highest starts number on record following 1972’s 2.36 million units. On the single-family side, starts hit 1.71 million units for all of 2005. This is up 6.4 percent from 2004 and the best pace ever recorded. It’s also the third consecutive time that single-family starts have broken the annual record.”

For 2006 the NAHB forecasts approximately 1.93 million units, which is a 6.5 percent decline in national housing starts from the estimated 2.06 million units in 2005. This is very close to 2004’s 1.95 million units. Single-family starts are projected to decline to 1.59 million from 2005’s 1.71 million units, while sales of new single-family homes will adjust to roughly 1.19 million units from 2005’s record-breaking 1.27 million.

Seiders compares the projected levels of 2006 to the healthy levels of 2004, “in terms of single-family sales and starts, we’ll basically be retracing the increases we saw in 2005, heading back to 2004’s very healthy levels. This report is an indication that the market is returning to a healthy and more sustainable pace, and is in line with what our builder surveys have been telling us.”