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New Jersey Homebuilding Rebounded In August – But Trails 2015


New Jersey's homebuilders obtained 2,539 building permits (i.e., the final authorization needed to commence construction) in August.  That was 59.9% more than in July according to the U.S. Census Bureau. View accompanying chartbook.

Year-to-date through August, the number of approvals was 13.9% less than in the first eight months of 2015.  [Chart 1]

Month-on-month:  In August, the most recent month for which data are available, 2,539 new residential units were approved for construction.  August's 59.9% month-on-month increase was the largest monthly gain since February.  [Chart 2]

Of August's total permits, 71.3% were multifamily authorizations (i.e., approvals for the construction of structures containing multiple dwellings).  The monthly count (1,811 attached units) and its share of total permits were the largest since February.  [Chart 4]

The month-on-month net increase (951 units) was due to a sharp rise (+123.0%) in the number of multifamily authorizations that was partially offset by a 6.2% decline in single family approvals. 

Single-family permitting is sensitive to recurrent factors (e.g., weather) which cause activity to fluctuate on regular patterns.  When adjusted for such seasonality, the number of detached units approved in August was up just 1.0%.  [Chart 7]

Over each of the past four months, again adjusted for seasonality, the total number of single family approvals has remained below 800 units.  Such a span has not occurred since early 2013.  [Chart 7]

Year-on-year:  The number of units authorized in August was 5.5% more than in August 2015.  That was attributable to a 19.5% increase in multifamily dwellings (up 296 units) and a drop of 164 (-18.4%) single-family approvals.

Year-to-date:  The number of units authorized in 2016's first eight months totaled 18,052, down 13.9% (-2,904 units) from last year's comparable period.

The  YTD decline is almost entirely attributable to a sharp drop in multifamily permits.

Through August, New Jersey has approved 2,557 fewer multifamily units than in 2015's first eight months.  Single-family approvals were down 347 units (-5.0%) from the same period in 2015.
 

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