One of the top indicators of future building activity is the rise of current housing permits. And if the beginning of 2013 is anything like the month of November, it looks as if the market for real estate in Chicago will be off to a strong start!
Building permits rose 3.6 percent in November, with a total of 899,000 units added. Out of the added units, 334,000 belonged to the multifamily sector.
“The starts report for November reflects a readjustment to a more sustainable level of production following significant gains in the previous two months,” said David Crow, NAHB Chief Economist.
However, while housing permits increased, housing starts have decreased by 3 percent, though this isn’t necessarily bad news.
“Many builders have reported improving conditions in their local housing markets and are increasingly optimistic about the spring buying season, but they are being very careful not to get ahead of demand,” said Barry Rutenberg, chairman of the National Association of Home Builders (NAHB).
Home builders need to be realistic in terms of housing starts in order to avoid any chance of overbuilding. It is also important to note that the Midwest experienced the highest regional gain in housing permits at a rate of 8.1 percent, so the housing industry growth applies to the entire state of Illinois, and not just the Chicago area.