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February 2005 Permit Statistics


3/10/2005


Residential Construction Permit Activity Slows
Year-To-Date Planned Units Remain Greater Than in 1998, 1999 and 2001

In the first two months of 2005, the residential new construction market has cooled some from the previous few years. As activity had been climbing almost steadily for the past seven years, this slow-down may signal a return to a more normal pace. Putting the activity in perspective, the total planned units for 2005 are 34 percent higher than the average during the first half of the 1990s.

February 2005 had a total 472 permits issued for 735 planned units at a value of $152,851,160. This is 21 percent behind February 2004’s 597 permits, 19 percent behind last year’s 905 planned units, and 13 percent behind last February’s value of $176,687,436. Comparing to the previous six years, permits are 24 percent behind 2003, 19 percent behind 2002, 25 percent behind 2001, 36 percent behind 2000, 26 percent behind 1999 and 17 percent behind 1998. In planned units, 2005 is 29 percent behind 2003, 28 percent behind 2002, 13 percent behind 2001, 25 percent behind 2000, three percent behind 1999 and 11 percent behind 1998. Value of permits in 2005 runs nine percent behind 2003, five percent behind 2002 and between two and 45 percent ahead of 1998 through 2001.

Year-to-date in 2005, the total number of permits issued is behind every year except 1998 in the previous seven, planned units are ahead of 1998, 1999, and 2001; and in value the year is behind 2003 and 2004 only. During the first eight weeks in 2005, the region issued 1,082 permits for 1,678 planned units at a value of $344,833,388. In permits, this was 22 percent behind 2004, 20 percent behind 2003, five percent behind 2002, seven percent behind 2001, 21 percent behind 2000, 15 percent behind 1999 and six percent ahead of 1998. Planned units were 30 percent behind last year, 32 percent behind 2003, 27 percent behind 2002, nine percent ahead of 2001, 12 percent behind 2000, 11 percent ahead of 1999, and 15 percent higher than in 1998. Value of permits year-to-date in 2005 was 18 percent behind 2004, seven percent behind 2003, and ranged from five to 83 percent higher than in 1998 through 2001.

Attached housing continues to contribute to the slow-down, with a total of 314, or 42.7 percent of the total planned units in February, and 716, or 42.7 percent of the total year-to-date. This compares to multi-family units running at 52.7 percent annually for 2004, 48.6 percent in 2003, 43.7 percent in 2002, 41.5 percent in 2001, and 37.5 percent in 2000.

“While the local permit statistics seem to indicate a slowing of the market,” says Doug Nelson, 2005 president of the Builders Association of the Twin Cities and owner of New Spaces, “the US Census Bureau recently reported that permits in January 2005 were up over six percent from the previous January nationally, and our builders are reporting a very strong Parade of HomesSM is underway.

“With the strength of the Twin Cities Parade of HomesSM, we may simply be seeing new home buyers waiting to make their decision until after they’ve had a chance to check out all their options during the tour,” he continues.

Actual permit, planned unit, and value statistics for the first eight weeks in each of the past eight years are as follows:

2005 — 1,082 permits, 1,678 planned units at a value of $344,833,388
2004 — 1,385 permits, 2,410 planned units at a value of $419,979,818
2003 — 1,348 permits, 2,472 planned units at a value of $370,419,581
2002 — 1,144 permits, 2,285 planned units, at a value of $328,896,866
2001 — 1,160 permits, 1,541 planned units at a value of $252,845,617
2000 — 1,365 permits, 1,906 planned units at a value of $281,634,598
1999 — 1,277 permits, 1,518 planned units at a value of $213,570,147
1998 — 1,024 permits, 1,466 planned units at a value of $188,011,078

For the month of February, only Woodbury remained one of the top five cities for permits and Rosemount remained in the top five for planned units. The top growth cities in permits were Lakeville with 34, Woodbury with 32, Cottage Grove with 27, and Maple Grove and Minnetrista each with 22. In Planned Units during February, Bloomington was first with 95, followed by Lakeville with 66, Ramsey with 43, Woodbury with 40 and Rosemount with 37.

During the first eight weeks of 2005, top growth cities in permits were Woodbury with 58, Lakeville with 49, Rosemount with 47, Shakopee with 46, and Otsego with 38. In planned units Bloomington took the lead with 95 units (all in one building), followed by Lakeville with 89, Rosemount with 78, Otsego with 76 and Shakopee with 73.

The Builders Association of the Twin Cities has contracted with Keystone Report, a local research firm, to maintain a database with information about new residential construction permits around the metropolitan area. After the builder has picked up the permit from a city, Keystone Report compiles and updates weekly residential housing permits by city for 70 percent of the metropolitan-area municipalities within the 11-plus county region. Planned units are the total number of housing units planned to be built under the permits issued (one permit is issued per building which may include more than one housing unit). Permit value does not include the land/lot costs. The reporting period for February compares statistics four weeks, while year-to-date figures cover the the first eight weeks of the year.


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