ASPEN RENT-ALL BLOG

In an approximately one-third increase over the same month last year, 227 permits were issued in March to area home builders in El Paso County and Colorado Springs for single-family units. This marks a 15 month straight increase in these types of permits on a year-over-year basis.

Permits for single family buildings have totaled at 625 for the first quarter of 2013, which is a 70.3 percent jump over the same period a year ago in 2012. It also marks the best first quarter for any year since 2007.

Factors that are helping to drive the market right now include historically low mortgage rates as well as the pent up demand coming from buyers who have been trying to ride out the economic slump. According to builder Dave Hammer of Hammer Homes Incorporated, low rates make buying a home as cheap as renting an apartment for a significant portion of people. “The Rental market’s at an all-time high. For the same price, and very little money down, you can get into a new home and own it, and that’s very attractive for homebuyers.”

Also contributing to the boost in the home building industry are fewer foreclosures coming back on the market and competing with new homes, said Hammer. “The last two or three years, we had an excessive amount of homes that were on the market that were either foreclosures or taken back by the bank. We’ve cycled through that.”

In addition to the aforementioned factors, there are plenty of homes being rebuilt after their destruction due to the Waldo Canyon fire last year contributing to the rebound. While it may seem like these houses would be the lead contributing factor to the peak in numbers, only 60 – or 9.6 percent – of the 625 single-family homebuilding permits taken out through March of this year were for homes that were being built in the area affected by the fire according to Regional Building records.

As should be expected, prices are rising as homebuilding makes its rebound. Once the recession hit and homebuilding wasn’t as lucrative a business to be in, suppliers kept prices consistent for drywall, concrete and other construction materials. These costs are now going up, according to Hammer his costs for lumber have increased by $1,000 each month since September. “That’s a signal to people that may have been kind of waiting for a sign, that now would be the time to get back in the game (and buy a home),” Bissett said.

More jobs are required as all these new homes are being built to ensure a sustainable recovery, added Bissett. As homes are being built the subcontractors doing the framing, concrete work or other jobs are increasing the sizes of their respective crews. “People are at the point now in our industry where they’re becoming a little less concerned about adding people back into their businesses. In the past, We’ve been very careful about overhiring or adding additional jobs, just because we weren’t sure where this (recovery) was going to go.”