New construction rose in February, as lumber costs fell and builder optimism jumped.
Lumber prices are back down to pre-pandemic levels, around $400 per thousand board feet. The latest NAHB Market Index shows that construction companies are in better spirits. They seem to anticipate improved conditions later in the year.
The number of building permits increased by 13.8% compared to January. This was due in large part to a 7.6% rise in the number of building permits for single-family homes.
However, compared to the same period last year, the number of permits was down by 17.9%.
Housing starts also saw a jump in single-family activity and were up 9.8% from January. However, compared to last year, the number of housing starts was lower by 18.4%.
Completed homes ready for sale increased by 12.2% compared to January and were higher by 12.8% compared to February 2022.
Notably, the number of single-family homes completed increased by 1.0% compared to the previous month. The South and West saw double-digit increases in new properties.
All this adds up to good news for the housing industry, which has struggled with a new home shortage, a growing population and higher demand.