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NJ Homebuilding Drops In June


by Patrick J. O'Keefe, Director of Economic Research

View accompanying chartbook.

New Jersey homebuilders obtained 2,263 building permits (i.e., authorizations to begin construction) in June. This was 11.7% less than May’s total, which was the third highest number of monthly approvals since mid-2008. [Chart 1]

Despite June’s deceleration, the first half of 2014 was the best start for homebuilding in New Jersey since 2006. Year-to-date authorizations totaled 13,832, more than one-quarter (28.7%) greater than 2013’s comparable period. [Chart 6]

Authorizations of multifamily (i.e., attached) dwellings led the year-to-date advance, accounting for 61.2% of all approvals. This was the largest multifamily share for the first half of any year since the 1960s. [Charts 4 and 11]

Single-family approvals slipped in June for only the third time in ten years. Nevertheless, the three-month average of single-family permits was equivalent to the level maintained throughout the second half of 2013. [Charts 7 and 8]

Permit data (especially multifamily authorizations) tend to be volatile month-to-month and, like many economic indicators, vary seasonally.  Adjusting for those factors – by using a three-month moving average of seasonally adjusted data – residential authorizations slipped from May, but were still the highest since December 2007 and more than double the housing contraction’s mid-2009 nadir.  [Chart 6]

Despite those gains, the seasonally adjusted, three month-average of approvals in June was two-fifths (-39.5%) less than June 2005, when the seasonally adjusted three-month average peaked at 3,297 units.

The statements, opinions, and conclusions contained herein are based solely upon the author’s own studies, research, and personal experience. Neither CohnReznick nor the author make any representation or warranty as to the accuracy or completeness of this information. CohnReznick and the author expressly disclaim any liability for any loss or damage which may be incurred, of any kind whatsoever, as a result of or arising from the use of any of the information contained herein or reliance on the accuracy or completeness of it.

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