The total number of residential permits issued nationwide during the first month of this year was a slight 0.5% lower than in January 1999. Not a bad start to 2000, particularly in light of the fact that mortgage rates have moved significantly higher over the past several months. During January 1999 the nationwide average for a 30-year fixed rate mortgage was 6.79%; by January of 2000 that average had risen to 8.21%.
Weather and economic conditions combined to give residential markets in some regions of the nation a good first month of the new year. In fact, permit totals for six of the nine regions of the country were higher this January than during January 1999 - despite the overall decline in the national permit volume. The number of permits issued in the largest region of the nation - the South Atlantic - faded 8.7% between last January and this January. The Rocky Mountain states also saw activity decline, as did the West South Central region (the biggest loser in percentage terms). However, the overall impact of declines in these three pockets of the country was blunted by solid gains throughout the Midwest and Northeast, as well as by improvement in the Mid-South and on the Pacific Coast.
During the first month of 2000, the number of residential units permitted for construction rose from the level of a year earlier in 29 states and fell in 21 states (and the District of Columbia). The losses were most severe in the South, with 5 of the 8 states in the South Atlantic region issuing fewer residential permits this January than during January 1999, and all four states in the West South Central region (Texas, Oklahoma, Arkansas, and Louisiana) recording fewer permits this January than a year ago. Double-digit over-the-year increases were registered in 24 of the 29 growth states. Among the larger states getting off to a great start this year were California (+11.2%), Michigan (+36.9%), Illinois (+29.6%), New Jersey (+72.7%), and Washington (+16.5%).