Construction Lending on Upward Trend 2nd Month
While the credit crunch for the building industry is still severe, the worst may be over, according to San Diego-based Dataquick Information Systems.
California construction lending totaled $942 million in August. That was the second-highest monthly total so far this year, outdone only by July’s $996 million. During the January-to-June period, construction lending ranged from $611 million in February to $879 million in May.
Last month’s total was 39.2% lower than the $1.55 billion for August, 1990, according to Dataquick. The percentage decline is by far the lowest year-over-year comparison this year. Until August, declines in construction financing ranged from 58.3% in May to 66.7% in March.
“This can’t be called the start of recovery for construction financing, but the decline does seem to have bottomed out,” said Donald L. Cohn, Dataquick president. “There are a lot of prime deals out there waiting for money. The lenders that are active right now can pick and choose among some real plums.”
Dataquick monitors all real estate sales and financial activity and provides information to lending institutions, title companies and industry analysts. The dollar volume figures cover all construction financing, commercial and residential.