New home construction was down 25.7% southwest Ohio in May compared to a year ago and 11.1% in year to date that month, according to the most recent data released by Home Builders Association of Greater Cincinnati.
That includes single-family and condominium portions of the market, both of which experienced decreases.
Overall, single-family construction decreased 21.3 percent from 282 units in May 2019 to 222 this May. Year to date total are down 3.8 percent, going from 1,204 by the end of May 2019 to 1,158 by the end of this May.
Construction permits were tracked from Butler, Clermont, Hamilton, and Warren counties, which dropped by 35.2%, 18.3%, 29.3% and 11.8% in the amount of single-family home permits, respectively, compared to May of last year. That meant a May that failed to meet up to the past several years, where permits increased from 276 in 2015 to 334 (2016), 334 (2017), 340 (2018) and 398 (2019) before dropping to 234 this past May, a statistic that include condominiums.
But Dan Dressman, executive director for the Home Builders Association of Greater Cincinnati, said he believes the May dip is a temporary downturn during the coronavirus pandemic.
“I don’t think it’s a sign of anything. The market is really healthy right now,” he said. “I just think there was a brief pause in May.”
Inventory still has not risen to meet the demand being created by home buyers.
“Builders, for the most part, are playing catch up,” he said.
A total of 33 condominiums were produced last May, compared to 12 in May 2019, a 63.6 percent drop. All 12 of those units were in Hamilton County. Year to date totals are down 57.8 percent, going from 187 by May 2019 to 79 units by the end of this May.
Dressman said the condominium market is still “relatively strong” and, historically, has never been as strong in the region as single-family home construction has been. A dip in permits is not a problem for that segment of the market, he said.
“Some of that product may be in the planning stages and just not put on line yet,” Dressman said.
The communities in Butler County benefiting most from that catch up in May were Liberty Twp. (101 permits), West Chester Twp. (33 permits) and Monroe and Hamilton (both with 18 permits each). Warren County’s top jurisdictions were Deerfield Twp. (125 permits), Hamilton Twp. (65 permits) and Morrow and the Warren County portion of Middletown (both with 46 permits each).
Other recent statistics paint a better picture about the region. Across the Cincinnati, OH-KY-IN area, house prices grew by 1.4% during the first quarter of 2020, and over the past year, house prices in the metropolitan area rose by 5.3%, according to the National Association of Home Builders’ economics and housing policy department. At the low in the fourth quarter of 2013, house prices in Cincinnati, OH-KY-IN were 10.8% below their fourth quarter of 2006 peak level.
House prices in the area are now 21.2% above their peak level.