Construction slows in September, YTD numbers up 35%

A warmer than usual fall had home builders slinging hammers left and right with 214 new home starts in September in the region’s four largest cities.

Fayetteville, Springdale, Bentonville and Rogers issued combined new residential permits valued at $47.15 million in the month. Builders began 69 more homes in September than a year ago and permit values rose 35.6% from $34.74 million reported a year ago.

Fayetteville was the only city to see fewer permits in September. Rogers more than made up for that shortfall with triple-digit gains, while Bentonville and Springdale also reported healthy results.

September residential permit values for the four cities were:

• Bentonville: $18.10 million, up 39.6%

• Fayetteville: $6.11 million, down 26%

• Rogers: $13.56 million, up 111%

• Springdale: $9.36 million, up 32.14%

The commercial market in September, however, was down from a year ago. The combined cities issued commercial construction permits valued at $20.76 million in September, down 68% from a year ago when the combined value was $66.28 million.

September residential permit values for the four cities were:

• Bentonville: $4.16 million, down 54%

• Fayetteville: $4.68 million, down 79%

• Rogers: $10.51 million, down 68%

• Springdale: $1.40 million, flat

The pause in commercial work took the total September permit values down to $67.91 million among the four cities, 32.7% below the $101.03 million in September 2015.

Quarterly, Year-to-Date Comparisons

Third-quarter permits (July 1 to Sept. 30) totaled $211.79 million, down from $345.3 million in the same period a year ago. Bentonville was the only one of the four cities to see more third-quarter building activity this year compared to 2015.

Quarterly (July through September) permit values for the four cities were:

• Bentonville: $86.56 million, up 12.66%

• Fayetteville: $36.88 million, down 73.79%

• Rogers: $45.68 million, down 38.9%

• Springdale: $42.65 million, down 19.3%

Through the first nine months of 2016, the cities issued combined new residential and commercial permits worth $816.2 million, up 35% from the same period in 2015. Growth has been evident in both sectors throughout this year with permit values rising more than $213 million from 2015.

Through September, commercial activity, which includes multifamily projects, has comprised 58.4% of the combined permit values. The four cities issued new commercial permits worth $477.276 million in the first nine months of this year.

While commercial construction has been active, it’s the residential sector that continues to be hot month after month. Builders began 1,443 new homes during the first nine months of this year, 16.5% more than in the same period of 2015. Rising home prices pushed new home permit values up to $338.99 million, a gain of 22.8% from a year ago among the four cities.

Bentonville’s 427 new homes were valued at $124.17 million, up 18.21% from a year ago. Bentonville also has the highest average new home value at $290,800, rising 12.95% from a year ago. Rogers issued 431 new home permits for builders this year with a combined value of $75.09 million, just above the 412 new homes worth $71.12 million a year ago. The average new home permit value in Rogers dropped slightly to $171,907 this year.

Home builders in Springdale started 270 new homes through September valued at $66.24 million. Residential construction is growing by double-digits from a year ago. The number of permits rose 10% from a year ago and permit values are up 15% from $57.54 million last year. The average home permit value in Springdale rose to $245,348 this year, compared to $233,856 in 2015.

Fayetteville builders received 315 new home permits through September, up from 296 a year ago. The value of the 2016 permits totaled $74.48 million, up 13.16% over the $65.81 million a year ago. The average new home permit was valued at $236,457 through September, up slightly from $222,361 a year ago.