California Housing Starts Reflect Normalizing Market!

New home construction in California declined during May 2006, falling 21.2 percent when compared with the construction pace recorded one year earlier, the California Building Industry Association (CBIA) recently reported.

Despite the decline, housing starts continue to edge up on a month-to-month basis, suggesting builders are on track to produce 170,000 to 180,000 new housing units in California during 2006, the fourth-highest number of starts in the past 17 years.

Based on the number of building permits issued, 15,263 new housing units were started throughout the state in May, with single-family units accounting for 75.8 percent of the starts.

While single-family production is expected to remain strong in most of Southern California, starts are anticipated to trend downward in San Diego, the San Joaquin Valley, the Sacramento region, and the Bay Area, according to the report.

**Taken from the California Association of Realtors Bulletin, dated July 6, 2006.