Combined with a record January, the beginning of 2006 still ranks as one of the best starts on record for local new-home construction. A total of 1,578 units were permitted in the first two months of the year, down just 5 percent from the record 1,657 units permitted one year ago during the same time frame.

This winter’s construction season ranks as one of the strongest on record for Kansas City. The metro set new monthly marks for October, November and January, with winter construction up 8 percent heading into February. The hectic pace of new-home construction since October made last month’s lower permit totals a likely possibility, according HBA Executive Vice President/CEO Tim Underwood.

“The rate of new home construction in metro Kansas City the last six months has been phenomenal, and we certainly expect the market to adjust to the growing inventory of new homes,” Underwood said. “Mild winter weather has certainly been advantageous for home builders eager to get the jump on the spring buying market, and we would expect that many home builders may have accelerated their timelines due to the favorable conditions. Despite the slowdown in February, the construction market is still off to a better than expected start for 2006.”

Permit rates have also varied widely across the metro, taking into account existing inventory and market absorption. Single-family unit permits in Clay County are off 30 percent to begin the year, but starts in neighboring Platte County are up a metro-high 84 percent, allowing the Northland to capture 29 percent of all new-home starts, ahead of Johnson County at 26 percent and Jackson County at 23 percent. Cass County has also started 2006 strong, with unit activity up 13 percent to a market share of 11 percent.

“It is not uncommon this time of year to see fluctuating permit rates in different communities, especially given the strength of the construction cycle this fall and winter,” Underwood said. “We expect to see local home builders exercise some caution over the next few months as the market adjusts to the influx of new inventory and consumers adjust to changing mortgage rates. The industry is still very bullish on the region’s long-term prospects, but we expect to a wait-and-see attitude at the same time.”

Kansas City, Mo., leads the metro area in single-family construction year to date with 364 units. Overland Park ranks second with 199 units followed by Lee’s Summit with 116 units. Rounding out the top 10 are Lenexa with 88 units; Olathe, 81; Independence, 72; unincorporated Platte County, 64; Kansas City, Kan./Wyandotte County, 59; Grain Valley, 56; Raymore, 53.

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.