For the year-to-date, new-home construction is down 7 percent from last year’s record pace. A total of 6,110 single-family permits have been issued through July, compared to 6,604 at the same time last year. July’s strong numbers show that despite higher speculative construction inventory in some locations and price points, local demand for new-homes remains strong, according to HBA Executive Vice President Tim Underwood.

"Last month’s totals punctuate that both consumers and home builders are very optimistic about market conditions," Underwood said. “We’re continuing to see strong demand in communities that emphasize a great breadth of housing choices, particularly focusing on choices for first-time home buyers and first-time move-up buyers.”

In Johnson, Jackson and Clay counties – which account for nearly three-quarters of local new-home construction, permit activity is down nearly 13 percent. That is offset by a 6 percent gain in faster growing smaller communities, such as Cass (up 12 percent), Platte (up 6 percent) Leavenworth (up 22 percent) and Wyandotte (up 1 percent) counties. All but Platte County have average new-home sales prices below the metropolitan average.

Underwood said recent gains in mortgage rates should have little effect on consumer demand for new-homes through the rest of 2005 and 2006. He also said recent comments by Federal Reserve chairman Alan Greenspan a decline in homes sales and prices apply more toward the national housing market and select rapidly growing markets than they do toward Kansas City.

“Home value appreciation and construction in Kansas City have been healthy,” Underwood said. “Home prices in Kansas City have been driven in a significant part by public policy, not by an abundant demand and limited supply some areas have seen. Metro Kansas City is positioned to fare very well if we do a better job of matching public policies to consumer demand, and I think there are signs that is happening.”

Kansas City, Mo., leads the metro area in new-home construction with 1,028 single-family permits issued so far this year. Olathe ranks second with 572 permits, followed by Lee’s Summit with 461 permits and Overland Park with 349. Rounding out the top 10 are Raymore, 293 permits; Kansas City, Kan./Wyandotte County, 269; Shawnee, 261; Independence, 244; Gardner, 243; and Lenexa, 195.

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.