Single-Family Homebuilding Dropped in November
Although builders continue to report a strong interest and demand for new homes, November saw a 12 percent year-over-year decline in single-family home building in the Twin Cities metro area. Last month, builders pulled 619 permits, down from 701 in November 2020, according to Housing First Minnesota.
The figures mark an evident slowing from the rapid pace of homebuilding seen at the end of 2020 and early 2021. In a statement, Housing First Minnesota president Todd Polifka described the earlier surge in homebuilding as an “all-out blitz.”
But Multifamily home building construction did pick up in comparison to their slow start this year: Builders pulled 877 permits for multifamily units in November, a 2 percent increase from last year.
In total, 661 permits were issued for 1,496 units in November, according to Housing First’s monthly “Keystone Report.”
“We know part of the slowdown stems from market conditions: supply chain issues, labor shortage, development and permitting delays,” said Katie Elfstrom, spokesperson for Housing First Minnesota. “Our housing market has a significant shortage of homes available and these additional delays are not helping us balance the housing market to help ease prices.”
For November, Lakeville led the pack of cities in the metro with 53 permits issued. Maple Grove took second with 49 permits issued.
“In spite of headwinds, interest rates remain low and builders are working through barriers to meet the demand and create homes for Minnesotans,” Elfstrom said. “With the few options in existing homes for sale, more and more buyers are looking to get exactly what they want in a home by building new.”
The total value for all permits – single-family and multifamily combined – for November totaled $290.4 million, marking a 12.6 percent dip compared to last year.