Housing permits for single family home construction increased 4.5 percent through the third quarter of 2017. According to the U.S. Census Bureau, 12,663 permits were issued in the first nine months of 2017, compared to 12,115 for the same period in 2016.
The annual housing permit forecast for Michigan issued in January 2017 by the Home Builders Association of Michigan (HBAM) predicted a full year increase of 4.2 percent for the home building industry. “It is great that we are ahead of last year, but we have to balance that with the fact that three months ago we were running 10.6 percent ahead of 2016,” said HBAM CEO Bob Filka. “Builders are being impacted by a shortage of skilled workers, lot availability, regulatory delays and rising costs.”
After a series of summits held throughout Michigan in early 2017, HBAM issued a report that warned of a looming housing shortage in Michigan and proposed a 13-point action plan to confront the challenge. Several bills dealing with skilled trades and other issues identified in the report have been introduced, and the state plans to commission a study analyzing how local municipalities manage land development, housing and renovation approval processes.
“The fact is that new home production is constrained, and prices are rising. More and more middle-class consumers are getting priced out of the new home market,” said Filka. “This has a ripple effect throughout the housing marketplace, resulting in higher rents and sales prices for existing homes.”
Filka is encouraged by actions being taken at the Capitol and around the state in response to the HBAM report, which can be downloaded at HBAofMichigan.com.