March ‘09 closings, building permits, and contracts in Houston

Permit/contract data tentative

Wendy Natt, Apr 24, 09.

The Houston Multiple Listing Service tallied 5,022 home sale closings in March 2009, according the the Houston Association of Realtors. This number is down 18.9 percent from March 2008 closings, but it’s the smallest decline yet seen in 2009, which may indicate that the rate of market weakening may be slowing, according to a Greater Houston Partnership (GHP) email update.

Meanwhile, the value of new building contracts in the Houston metropolitan region for March 2009 remained low - down 55 percent from March 2008, according to McGraw Hill Construction figures presented in GHP’s Economic Indicators report for April 24, 2009. A recent GHP update notes, “Nonresidential contracts fell 68 percent from $901 million and residential contracts slid 33 percent from $576 million.” GHP finds it likely that those contract values will be revised upward - possibly substantially - as 2010 contract activity data are reported.

However, the value of construction permitted by the city of Houston in March 2009 totaled $456 million, a 5.5 percent increase over March 2008, according to city building permit data. GHP notes that the March increase places 2009 first-quarter totals 27 percent below totals for the first quarter in 2008. GHP cautions that “the monthly value of building permits is subject to high volatility, so it wouldn’t be wise to make overly much of the March data,” but it believes the figures indicate slowing decline.