Midway through the year, new housing activity is off to its fastest start since 2005, according to the Home Builders Association of F-M’s second-quarter building permit report. With 611 housing permits through the end of June, the F-M metro community encompassing Dilworth, Moorhead, Fargo and West Fargo experienced a 22 percent increase over last year’s 500 housing permits. All four cities have seen an uptick over last year in both new housing and residential remodeling.
Single-family homes increased by 46 permits community-wide, while twin-home construction saw a surge from 74 permits last year to 112 this year through second quarter. Row-house permits more than doubled, from 25 permits (64 units) to 59 permits (91 units). Housing permit values also grew, from just under $105 million last year to $129.6 million through June.
Remodeling permits went from 922 to 1,044, but total valuation dipped from $15 million to $14.6 million.
“Our weather has been outstanding for getting new homes in the ground. Even though we saw some rain in June, we had an open, dry spring which allowed the housing industry to start activity earlier than last year,” says HBA President Clay Dietrich, Dietrich Homes, Inc.
Click here to access the permit report itself.
Dilworth – Last year at this time, Dilworth had 5 housing permits; this year it had 17 valued at over $4.8 million, which is a 240 percent increase. Remodeling permits were similar to last year at this time with 27 valued at just under $200,000.
Moorhead – This year is Moorhead’s strongest start for new housing since 2007. With 129 permits taken, the city’s residential new construction was up 25 percent over last year’s numbers and more than triple the housing starts just two years ago. Twin-home construction was up 70 percent over last year and single-family permits are back to mid-2000 levels. Moorhead’s residential remodeling permits were up 14 percent.
“Both Moorhead and Dilworth are having a fantastic year so far, and seem to be making up for a lull in housing activity several years ago by satisfying pent-up demand now,” Dietrich says.
Fargo – Fargo saw a 20 percent increase in new housing permits over last year, going from 173 to 208, but came in under the nearly record level of 224 set in 2013. Residential remodeling rose from 524 to 549, about 5 percent.
“Fargo’s single-family market has rebounded well in second quarter from a slow start through March,” Dietrich says. “It appears that the areas which aren’t affected by the flood plain have opened up and are seeing activity.”
Dietrich points out that Fargo has been taking steps to raise its new developments out of the flood plain, but stresses that this is a temporary fix for avoiding high flood insurance costs.
“According to FEMA officials that announced the flood plain change in January, we’ve got about a five-year window at this flood height in Fargo,” he says. “If the F-M Diversion is not started by then, it’s very likely that the base flood elevation will go up an additional 1 1/2 feet, and will affect several thousand more existing homes in Fargo. Many people who work in Fargo, live in Moorhead, West Fargo or Dilworth, and vice versa. The F-M Diversion doesn’t only protect Fargo, it ensures economic vitality for our entire metro area and everyone who lives and works here.”
West Fargo – West Fargo’s housing permits were up 17 percent compared to second quarter last year. It had 257 housing starts: 161 single-family, 46 twin homes and 18 row houses. Residential remodeling increased 40 percent.
Overall – While total building permits are up 6 percent, total value across all communities through second quarter is down about 34 percent from last year. At $416.5 million, total construction value still exceeds the five-year average of $353.7 million.
Total permits and values include housing, multi-family, new commercial, residential and commercial remodeling, public and miscellaneous categories.
“Overall, last year was very strong in high-value projects categorized under multi-family and commercial construction. Many of the large projects permitted last year are still under construction which affects when new projects will be permitted,” Dietrich says. “For instance, both Fargo and West Fargo have experienced an upturn in row-house permits and units this year. I think we’re seeing a bit of market drive for that type of housing after a very big year last year for construction of apartment complexes.”
Each quarter, the HBA contracts with Fiebiger, Swanson, West & Co. to compile the building permits from Dilworth, Fargo, Moorhead and West Fargo into a uniform report for the industry’s and media’s use. It includes summaries for each city, types of construction, valuations and comparisons to the past four years, as well as comparisons to five-year and 20-year averages.
The HBA of F-M promotes an environment in which members and their businesses can prosper. It is a non-profit trade association of over 800 members that has been in existence since 1956. Its public events include the Spring Parade of Homes, Fall Parade of Homes, Remodeled Home Tour and Red River Valley Home & Garden Show.