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Tri-Cities construction activity is down from last year but is showing signs of picking up.
According to the Federal Deposit Insurance Corp., the number of single-family housing permits issued in the Tri-Cities increased from 318 in the second quarter of the year to 536 in the third quarter.
And reports show building permits issued for new construction and home and business remodeling projects are up over last year in Pasco and Kennewick.
For the 11-month period from January to November, the value of Pasco construction was about $151 million. That compared with $119 million for that same period last year.
Kennewick issued 1,749 building permits during the first 11 months of this year, up 187 from the same period in 2008 when the total was 1,562. That increased the year-to-date valuation by almost $200,000 over the same period last year, when projects were valued at about $52.1 million.
Richland's total construction valuation declined from about $178.3 million for the first 11 months of 2008 to about $87.9 million for the same period this year.
The total value of all building permits in the Tri-Cities from January through November was about $83 million less for the first 11 months of this year than the $526 million valuation for the same period last year, according to data from the Home Builders Association of Tri-Cities.
Jeff Losey, executive director of the Home Builders Association of Tri-Cities, said he's not surprised building permit valuations are down.
He said builders are no longer constructing expensive spec homes and waiting for buyers to come. Money supply is tight for builders and financial institutions are leery of financing projects unless the developers invest their own money.
Losey said most new homes under construction in the Tri-Cities are smaller and affordable, and building contractors are being careful not to overspend.
"They are trying to stay as lean as they can," he said.
Kennewick
Kennewick issued 231 permits for single-family homes from January through November, 19 more than the same period last year.
Pasco
Pasco issued 38 more residential building permits in November compared with the same period a year ago, up from 82 to 120. The city also issued 26 commercial permits last month, up from 19 issued in November 2008.
The number of new single-family home construction permits issued in the first 11 months this year was 422, up from 381 last year for the same time. Those homes were valued at more than $86 million this year, up from about $74 million in 2008.
Mitch Nickolds, Pasco's inspection services manager, said the increased value of construction this year shows that developers were willing to take on a higher level of risk than last year. But Pasco also is offering more homes in the price range buyers have been seeking.
Almost 90 percent of the new homes being built in Pasco cost less than $300,000, said Nickolds.
Les Savitch, president of Varsity Development of Pasco, said he's sold 40 homes so far this year in the $180,000 to $250,000 price range, most of them pre-sold. He hopes to build 80 next year.
The value of commercial construction projects in Pasco more than doubled, from about $17.1 million in 2008 to more than $42 million in November, Nickolds said.
Richland
Richland issued 26 permits for new homes in November, compared with 12 in November 2008. However, the city's count of 191 permits for the first 11 months of this year was down 30 compared with the same period in 2008.
More affordable homes are being built in the city now, said Kevin Rex, Richland's building official.
Benton/Franklin counties
The number of new home permits in Franklin County remained flat in 2009 and declined in Benton County, according to Washington State University's Center for Real Estate Research.
The center's figures say Franklin County issued 278 permits for single-family homes from January through October, compared with 281 for the same period last year.
And Benton County issued 317 similar permits from January through October, compared with 358 for the same period last year.
Permits issued for new homes are helpful in getting a sense of local housing markets, said Glenn Crellin, director of the WSU Center for Real Estate Research. But he said the data need to be viewed together with information on housing starts, housing completion and new home sales.
Crellin also explained that sometimes data from different sources don't match. For example, federal data excludes building permits for custom homes and homes in a development that are paid for before the start of the project, he said.
-- Pratik Joshi: 509-582-1541; pjoshi@tricityherald.com
