Source: Nasdaq —
As the dust settles and markets digest a dire realization, housing markets – which seemed to be the focus for investors and home buyers alike during the 2020-2022 period – are becoming an area of peril for some residents following the largest decline in value since 2008.
Investors would be well served to keep in mind that while the pie may have shrunk for the nation as a whole, some of its pieces have taken a bigger share of the feast, when the market undoubtedly recovers in due time these larger pieces will be right there to enjoy the excess of an upcycle.
Regions shrunk and expanded
Breaking down the preliminary results for the 2022 United States building permits survey by state, there are a couple of trends that become palpable if not highlighted on their own. The major trend is the share of national permits by region and state, where the South and Mid South take the bulk of the building activity in the tune of 73% of overall national permits. New York and California take the backseat for the preliminary annual permits, representing approximately 18% of permits.
So why are permits flows important? Well as permits get approved they usually point to a healthy series of industries which all revolve around credit and financing to function properly. From a construction loan all the way to a mortgage, more permits signify a healthy credit market held up by the reinforced pillar of housing buyer demand.
