April’s total marked a 17 percent gain from the same time last year. A total of 3,693 single-family building permits have been issued through the first four months of 2004, up 12 percent from last year.

The rise in new residential construction permits comes as mortgage rates are also on the increase. Expectations the Federal Reserve Board will soon raise interest rates have caused the national average for 30-year mortgage rates to rise nearly a full point since late March. The rise in rates will likely spur prospective buyers to accelerate home purchases to take advantage of historic low rates before they increase further, according to HBA Executive Vice President Tim Underwood.

“The recent increase in mortgage rates are probably a wake-up call for many new-home buyers that rates will not get any lower,” Underwood said. “The strong residential construction numbers suggest that new home buyers are looking to buy now before rates go higher.”

Underwood said while the short-term prospects for local new home construction are strong, rate increases will likely result in slower construction down the road. As mortgage rates rise, the purchasing power of local families will decrease, pricing many families out of the homeownership market.

“As rates rise, we will need to see more housing choices that reduce costs for new home buyers,” Underwood explained. “Both local municipalities and the development community will need to work together to provide more choices at the price points demanded by Kansas City’s families.”

Kansas City, Mo., remained the top city in new-home construction activity through April with 549 single-family permits issued. Heavy permit activity in advance of building code and plan review changes boosted Overland Park into second place with 336 permits, followed by Olathe with 333 permits and Lee’s Summit with 301.

Rounding out the top 10 are Shawnee, 193; Kansas City, Kan./Wyandotte County, 170; Independence 164; Gardner and Raymore, tied with 149; and unincorporated Platte County, 106.

The Home Builders Association of Greater Kansas City (HBA) is the voice of the housing industry and the source for housing information. Comprising more than 1,000 member companies, the HBA represents an industry that contributes more than $2.5 billion to the Kansas City economy and supports more than 36,000 jobs in the Greater Kansas City metropolitan area.