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Friday, March 23, 2012

WBS News: Housing Market Heats Up

This week marked the official start of spring, but temperatures have made it seem as though Wisconsin skipped ahead to summer. Even when more typical springtime (or winter!) weather returns, we can be glad for the increased activity across the state recently. Work is accelerated because contractors aren’t dealing with weather delays. Customer activity is picking up earlier because they’re happy to be out and about, surveying your work in Parade and Showcase events. But the truly positive news comes from recent housing reports.

The U.S. Census Bureau released its February 2012 residential construction statistics this week. U.S. housing starts were at a seasonally adjusted annual rate of 698,000 units in February, 1.1 percent below the revised January estimate but 34.7 percent higher than the February 2011 rate, according to Random Lengths. Permits in February were at 717,000 units, up 5.1 percent from January and 34.3 percent above the February 2011 estimate. February starts remained near a three-year high, which suggests that the industry is starting to stabilize. 

In the lumber market, you’ll want to note that this month marked the Random Lengths OSB Composite Price’s highest level since June 2010. In fact, our numbers show the cost of lumber materials for a typical two-story house is up more than three percent from last month and up nearly two percent from this time last year.

We will get a better idea of the improvement by looking at numbers closer to home. In the Midwest, most of the 14.7 percent increase in housing permits was in multifamily units. In the single-family sector, permits went up 2.7 percent from January to February, while housing starts increased by 13.9 percent.