Despite the slowdown last month, single-family new-home construction in the metro area is off just 4 percent from the record pace established in 2004, making the first four months of this year the second-busiest on record for new-home construction. A total of 3,559 single-family permits have been issued so far this year, down from 3,719 at the same point in 2004.

With forecasts calling for low mortgage rates and stronger local economic growth, the outlook for residential construction in the metro remains very optimistic despite the slowdown in April, according to HBA Executive Vice President Tim Underwood.

“New-home sales remain strong and ahead of last year’s record pace, putting the area on track for another positive year for housing,” Underwood. “The one concern facing local home builders is a rise in new-home inventory, with new-home listings up 28 percent compared to the same time last year. I believe many builders would like to decrease speculative inventory before moving forward and want to make sure they are continuing to build the right products at the right prices in the right locations.”

Only three of the top 10 municipalities in single-family permit totals have posted an increase in activity in 2005: Kansas City, Mo., is up 34 percent, followed by Raymore up 13 percent and Lenexa up 4 percent.
Overland Park has posted the largest decline, down 50 percent, as a slowdown in the plan review process, less developed land with sewers and a lack of home sites in price ranges demanded by new-home buyers has curtailed activity. Johnson County permits are down 20 percent accompanied by a 10 percent rise in the average new-home sales price to more than $325,000. The county’s market share has slipped from 34 percent at this time last year to 28 percent in 2005. Clay County has moved into second place with a 21 percent share, followed by Jackson County with a 20 percent share of the new-home construction market.

Kansas City, Mo., ranked as the top city for new single-family construction permits through April with 736 permits, followed by Olathe with 328 permits. Lee’s Summit ranked third with 261 followed by Overland Park with 168 permits. Rounding out the top 10 were, Raymore, 163 permits; Shawnee, 153; Kansas City, Kan./Wyandotte County, 143; Independence, 136; Gardner, 129; and Lenexa, 98.

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.