Housing production drops 47%
California’s housing production plunged 47% last month as builders curtailed construction while working to whittle down their existing supplies of unsold homes, data released Friday showed.
Builders obtained permits for 11,590 houses, condominiums and apartments in September, according to statistics compiled by the Burbank-based Construction Industry Research Board. By comparison, 21,717 permits were issued in the year-earlier period.
September’s permits were the fewest issued for that month since 1996.
The state’s housing market has slowed considerably in the last year. High home prices have damped demand, pushing up the supply of new and resale homes.
California builders sought permits at near-record numbers when the real estate market was rapidly accelerating from 2002 to 2005. But now they are trying to unload their so-called standing inventory of homes that are under construction or completed.
Builders are offering such incentives as price discounts, free upgrades and favorable mortgage rates.
Meanwhile, builders are holding off on new construction, said Wes Keusder, a builder and chairman of the California Building Industry Assn. Obtaining a permit is the first step in the construction process.
“Last year we had a waiting list of buyers interested in our homes before they were even built,” Keusder said. “This year, however, it seems as though we’re the ones who are waiting.”
Permits for single-family houses experienced the biggest drop in September, plummeting 57% from a year earlier.
Production in two of the state’s biggest new-home markets -- Riverside/San Bernardino and Sacramento -- fell by more than 60%.
Multifamily permits, used for condo and apartment construction, dropped 21% last month from September 2005.
