Monday, September 19, 2011

Construction Permitting Update

Is construction permitting really the black hole we've come to expect in recent years? Not if you live in some counties. In fact, construction permit data from the Utah Bureau of Economic and Business Research indicates that more than one-third of Utah's counties show an increase in construction permit values so far this year (January-June). Moreover, statewide authorized construction values are up 20 percent when compared with 2010.

Typically, home construction leads the way out of the recession. However, currently its nonresidential construction permitting that is forging ahead--at least statewide. (Keep in mind that public projects are not typically permitted.) After a little reflection, how could we expect otherwise? Overbuilding in the housing market created the recent recession and a huge inventory of homes for sale continues to put a drag on new home building. New permits for dwelling units are still down 10 percent statewide from last year's very low figure. However, permit values for new nonresidential construction in Utah are up 70 percent compared to a year ago.

County by county the construction is certainly more varied. About one-third of all Utah counties saw an increase in the number of homes permitted year-to-date. Seven of these counties also showed total gains in permit values. The Mountainland Region appears to be having its own little building boom--Utah, Wasatch, and Summit counties all experienced an increase in both dwelling unit permits and total permit values.'

Of course, many counties continue to see construction permitting slide. In particular, rural counties seem most likely deterioration of construction activity. 
To download more construction data from the Utah Bureau of Economic and Business Research website, click here.