St Louis New Home Construction Still On The Rise -Perimeter counties are the big winners

There were 4,468 building permits issued for new single-family homes in the St Louis area during June, an increase of 5.9% from a year ago when there were 4,219 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri (St Louis HBA).  However, the increase in new home construction activity was not shared equally around the St Louis area as the counties of St Charles, Jefferson, and Franklin all saw double-digit increases while the other four counties saw declines.


  

St Louis New Home Building Permits – June 2020

St Louis New Home Building Permits - June 2020

 

 

St Louis New Home Construction Declines In March In 5 Counties But On The Rise In 2

There were 4,506 building permits issued for new single-family homes in the St Louis area during March, an increase of 4.55% from a year ago when there were 4,310 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri (St Louis HBA).  However, the increase in new home construction activity was not shared equally around the St Louis area and, in fact, really only favored St Charles County and Jefferson County.

Of the seven counties reported on by the St Louis HBA, 5 saw a decline in building permits from a year ago with Lincoln County seeing the biggest loss at over 25%, and St Charles County was the big winner where the number of new home building permits in March increased nearly 25% from the same month last year.

St Louis New Home Building Permits – March 2020

St Louis New Home Building Permits - March 2020

 

 

New Homes Sales In 2019 Drop From Year Before In Midwest

There were 70,000 new homes sold in the Midwest Region of the United States during 2019, a decline of 7.2% from 2018 when there were 76,000 new homes sold, according to the latest data from the U.S. Census Bureau.

As the table below shows, there were 40,000 new homes for sale in the Mideast at the end of 2019, which translates into roughly a 7 month supply of new homes for sale.

New Homes Sold In Midwest – 2018-2019

(in thousands)

New Homes Sold In Midwest - 2018-2019

  

New Home Construction Trend In St Louis Remains Steady In October

New home construction in St. Louis during October held at about the same trend as September with 4,289 new home permits issued for the 12-month period ended October 31, 2019, a decline of 8.04% from a year ago when there were 4,664 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri.  This is about the same as September when the 12-month trend was down 8.05% from the prior 12-month period.

As the table below shows, 4 of the 7 counties covered in the report saw a decline in new home permits from a year ago.  This is the same as last month, with the same four counties on the decline.  For the 9th month in a row, Franklin County suffered the biggest loss at 41.31%.  At the other end of the spectrum, St Charles County had the largest increase at 7.55% and took removed Warren County from the number one slot after Warren County had 9 consecutive months of the highest growth in permits.

  

St Louis New Home Building Permits – October 2019

St Louis New Home Building Permits - October 2019

 

Downward Trend In New Home Construction In St Louis Eases In September

New home construction in St. Louis continued its decline, although at a lower rate, with 4,286 new home permits issued for the 12-month period ended September 30, 2019, a decline of 8.05% from a year ago when there were 4,661 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri.  This is an improvement from the 12-month period ended August 31, 2019, when the decline was nearly 10% from the year before (9.74%).

As the table below shows, 4 of the 7 counties covered in the report saw a decline in new home permits from a year ago.  Franklin County again suffered the biggest loss at 43.82% making it the 8th month in a row Franklin County has seen a loss.   At the other end of the spectrum, Warren County again had the largest increase at 22.22% and this marks the 9th month in a row of increases for the county.   For only the second time in the past 12-months, St Charles County saw an increase in new home permits issued during the period with a 3.79% increase.

  

St Louis New Home Building Permits – September 2019

St Louis New Home Building Permits - September 2019

 

New Home Construction Down From A Year Ago In 5 of 7 St Louis Area Counties

New home construction in St. Louis continues to decline with 4,244 new home permits issued in August 2019 for the St Louis area, a decline of 9.74% from a year ago when there were 4,702 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri.

As the table below shows, 5 of the 7 counties covered in the report saw a decline in new home permits from a year ago.  Franklin County has suffered the biggest loss at 44.13% and Warren County has seen the largest increase at 15.57%.

  

St Louis New Home Building Permits – August 2019

St Louis New Home Building Permits - Aug 2019

 

St Louis New Home Construction Slips Again In May

For the 12-month period ended May 31, 2019, there were building permits issued for 300 new homes in Jefferson County, a decline of nearly 26% from the prior 12-month period according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri.  For the same period, there were permits issued for 758 new homes in St Louis County, a decline of 23.50% from the prior 12-month period.

Warren County saw a double-digit percentage increase in building permits again this period, and the City of St Louis again had an increase.

  

St Louis New Home Building Permits – May 2019

St Louis New Home Building Permits - May 2019

New Home Construction Trending Downward in Over Half The St Louis Area Counties

For the 12-month period ended March 31, 2019, there were building permits issued for 748 new homes in St Louis County, a decline of 23.60% from the prior 12-month period, according to the latest data from the St Louis HBA.  As the table below shows, St Charles County saw a decline of 11.23% during the same period.  Last month, those were the only two counties showing a downward trend, but, this month, Franklin County and the City of St Louis have also seen new home construction trend downward. Warren County again showed the greatest upward trend in new home construction with an increase of 23.66% in building permits during the most recent 12-month period from the prior 12-month period.

  

St Louis New Home Building Permits – March 2019

St Louis New Home Building Permits - March 2019

Should you buy a new home directly from the builder?

Some new home buyers believe that if they buy a new home directly from the builder or the builder’s sales person, they will get a better price.  But is this true?  Do you get a better deal buying a new home directly from the builder?

First, we should address a “better deal” and what constitutes a good “deal”.  If it is strictly price, then, while I think it is somewhat short-sided on the part of the buyer and falls in that “penny-wise, dollar-foolish” category, in some instances, with some builders, the builder will save some cost by you buying from their agent.  This is the result of the builder having an agent that will get paid less commission that the builder would pay a buyer’s agent then if the builder chooses to pass that savings along to the buyer, rather than keep it, the buyer should receive a better price.  However, just like the possible savings motivated the buyer to deal directly with the builder, it is unrealistic to think that a builder is not going to feel the same and be motivated to have a better profit margin dealing directly with the buyer and instead would choose to forego the savings and give it to the buyer in the price. Plus, most builders appreciate and understand, the vital role a buyer’s agent plays in the transaction and wants to encourage agents to show and sell their homes, so they typically avoid doing things that look like they are trying to cut an agent out of a deal by dealing directly with the buyer.

  

New Home Construction Trend In St Louis Flat Overall

There were 4,642 new home building permits issued for the 7 counties in the St Louis area covered by the St Louis HBA during the 12-month period ended August 31, 2018, just 2 more (0.04%) than the 4,640 that were issued during the prior 12-month period, according to data from the St Louis HBA.

This would indicate that perhaps the new home building market has peaked for the time being which, given that this is the best report for this 12-month period since August 2007 when there were 5,706 permits issued in the prior 12 months, it’s not bad.

St Charles County’s Loss is Franklin County’s gain…

As the table below, which shows the building permit activity by county, illustrates, St Charles County has seen nearly a 14% decline in building permits in the past 12-months from the prior period, while Franklin County has seen nearly a 42% increase.  Granted, 32.9% of all the building permits issued in the 7-county area were issued in St Charles County, but a year ago 38.3% of all the permits were issued in St Charles County.

New Home Building Permits – St Louis Area

New Home Building Permits - St Louis Area