Permits for new single-family homes fell by 46%
Twin Cities homebuilding activity continues to stall as mortgage rates hold homebuyers on the sidelines. Metro builders pulled permits for 328 single-family homes in January, a 46% drop from January of last year. Multifamily construction in the Twin Cities hit a slump as well, with permits pulled for a 418 units, a 53% drop from this time last year.
“Homebuilders continue to see the market pause as homebuyers revaluate what they can afford with the current mortgage rates.” said John Quinlivan, 2022 board chair of Housing First Minnesota. “The demand for new housing is still there, it’s a matter of when rates will bring homebuyers back into the market.”
All together, there were 339 permits issued for a total of 746 units during four comparable weeks in the month of January, according to the Keystone Report.
“Our housing market remains widely undersupplied, we need new housing in Minnesota,” said James Vagle, chief executive of Housing First Minnesota. “The impacts from this slowdown in new construction will be felt for years to come as our region grapples with a shortage of housing.”
For the month in permits, Rosemount took the top spot with 37 permits issued. Maple Grove came in next with 28 permits. Woodbury with 27 permits, St. Michael with 19 permits and Farmington with 18 permits rounded out the top five.
For the month in units, Maple Grove came in on top with 187 permitted units. Burnsville came in next with 106 units. Followed by St. Michael with 71 units. Minneapolis with 57 units and Waconia with 46 units rounded out the top five.