Homebuilding has begun to slacken because of high mortgage interest rates, according to U.S. Housing Markets, published by Lomas Mortgage USA.
The publication said the issuance of single-family building permits dropped by about 1% in September from the level in the month a year earlier. For the third quarter, however, permits climbed by about 2%.
The cost of 30-year fixed-rate mortgages has climbed steadily this year, from just under 7% in February to a little over 9% today.
On adjustable-rate-loans, the rate has gone from a tad under 4% in February to about 6.15% today.
"All year long, new home sales and construction have defied predictions of a downturn," said Gary H. Kell, president of the Lomas unit. "Month after month, homebuilders turned rates moved steadily higher.
"But in September," he addede, "the comparisons with 1993 flattened.
Mr. Kell offered Phoenix as an example of a city with a gain for the third quarter--about 5%--but an abrupt turnaround in September with a 9% decline.
He added, "In Raleigh-Durham, one of the hottest markets in the country, September one-fam volume was down 9% from a year ago. Single-fam builders there still managed a gain for the quarter.
Boston also showed a slowdown in September but a gain for the first quarter, while New Jersey showed a hefty statewide gain of 23% for the quarter but a drop in September of 11%.
The abrupt reversal was also evident in Las Vegas. That city remained the hottest housing market in the country, with 24.6 permits issued per 1,000 population, exactly double that of Orlando, another conspicuously hot market.
But permits slipped by 0.3% in the third quarter, stalling at a high level after climbing 22.3% for the year through September.
Atlanta was the leader in the number of permits issued in the first nine months, with 30,231 for a gain of 14.2%.
It was followed by Chicago with 28,898 and a 13.9% gain.
Perhaps the most spectacular performer was the Phoenix-Mesa area, where 27,356 permits were issued for a gain of 45.6%.
By state, Florida was the leader in number of permits for the first nine months, reaching 106,487 for a gain of 19.4%.
California was second with 75,988 permits and a gain of 16.2%.
Texas was third with 73,706, up 29.8%.
Despite the September slowdown in single-family permits, multifamily housing continued to show unusual strength, Mr. Kell said.
Permits surged by 76% for the month and 59% for the third quarter.
So far this year, developers have taken out permits for more than 220,000 units, exceeding their volume for all of last year.