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WASHINGTON - U.S. home construction plunged in August, led by steep decline in the volatile apartment category. But single-family house construction, a larger and more stable portion of the market, fell only modestly.
Construction fell 14.4 percent in August to a seasonally adjusted annual rate of 956,000 homes, the Commerce Department said Thursday. This reverses the sharp gains in July when the rate of new construction rose to 1.12 million homes, the highest annual rate since 2007.
Last month's decrease primarily came from builders starting fewer apartment complexes, which plummeted 31.5 percent compared to July. Apartments have propelled much of the growth in residential construction over the past year, but the pace has been volatile from month to month. Apartment starts surged 51 percent in July.
In August, the building of single-family houses fell 2.4 percent.
Applications for building permits, a sign of future activity, dipped 5.6 percent to an annual rate of 998,000.
Apartment construction has surged 19.2 percent in the past 12 months. Meanwhile, single-family starts have risen just 4.2 percent. The shift among builders to increased apartment building is a sign that a rising share of Americans will be renters, rather than homeowners.
Jed Kolko, chief economist at the real estate firm Trulia, said that builders are already constructing too many single-family houses. The vacancy rate for these homes was 10.7 percent in 2013, compared to 7.4 percent in 2000, according to the Census.
"We're still building single family homes faster than we can fill them," said Kolko, saying that builders will need to place a greater emphasis on apartments.
Changes in starts for multi-unit homes such as apartments influence the monthly construction totals, but the category accounted for just 32 percent of starts in August. That's up slightly from 29 percent in August 2013.
The growing preference for rentals likely reflects the sluggish, five-year economic recovery. Most incomes remain below their pre-recession levels, making it harder for families to save for a down payment and qualify for a mortgage. The Census Bureau said this week that median household incomes were $51,939 in 2013. Adjusting for inflation, that's 8 percent lower than in 2007, when the recession began.
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Volatile apartment sector reduces home building
WASHINGTON (AP) U.S. home construction plunged in August, led by steep decline in the volatile apartment category. But single-family house construction, a larger and more stable portion of the market, fell only modestly.
Construction fell 14.4 percent in August to a seasonally adjusted annual rate of 956,000 homes, the Commerce Department said Thursday. This reverses the sharp gains in July when the rate of new construction rose to 1.12 million homes, the highest annual rate since 2007.
Last month's decrease primarily came from builders starting fewer apartment complexes, which plummeted 31.5 percent compared to July. Apartments have propelled much of the growth in residential construction over the past year, but the pace has been volatile from month to month. Apartment starts surged 51 percent in July.
In August, the building of single-family houses fell 2.4 percent.
Applications for building permits, a sign of future activity, dipped 5.6 percent to an annual rate of 998,000.
Apartment construction has surged 19.2 percent in the past 12 months. Meanwhile, single-family starts have risen just 4.2 percent. The shift among builders to increased apartment building is a sign that a rising share of Americans will be renters, rather than homeowners.
Jed Kolko, chief economist at the real estate firm Trulia, said that builders are already constructing too many single-family houses. The vacancy rate for these homes was 10.7 percent in 2013, compared to 7.4 percent in 2000, according to the Census.
"We're still building single family homes faster than we can fill them," said Kolko, saying that builders will need to place a greater emphasis on apartments.
Changes in starts for multi-unit homes such as apartments influence the monthly construction totals, but the category accounted for just 32 percent of starts in August. That's up slightly from 29 percent in August 2013.
The growing preference for rentals likely reflects the sluggish, five-year economic recovery. Most incomes remain below their pre-recession levels, making it harder for families to save for a down payment and qualify for a mortgage. The Census Bureau said this week that median household incomes were $51,939 in 2013. Adjusting for inflation, that's 8 percent lower than in 2007, when the recession began.
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Volatile Apartment Sector Dragged Down U.S. Housing Starts in August
File photograph of pedestrians passing the boarded up 74 Grand Street in SoHo that John Dunne is seeking to develop. Photograph: Michael Nagle
The son and wife of bankrupt developer Sean Dunne have altered plans for a proposed development in New York, forcing their company to seek renewed permission from the Landmarks Preservation Commission that oversees building work in the citys historic areas.
TJD 21, the company owned by Mr Dunnes wife Gayle Killilea Dunne and his son John Dunne, submitted revised plans for the proposed development at 74 Grand Street in the fashionable Soho area in Manhattan last month.
The plans involve moving the entrance, stairwell and lift in the five-storey apartment development to the other side of the building.
The internal changes require approval from the commission, because the building is in Sohos protected historic area, before the citys planners can grant the green light, paving the way for construction to begin.
John Dunne included a letter in revised plans filed by his companys planners and engineers last month.
They said that the change was due to the stability of foundation walls on the next-door building.
Sean Dunne, who filed for bankruptcy in the US last year with debts of $942 million (700 million), has said he is working as a paid adviser for the firm owned by Ms Killilea Dunne and her stepson.
The company has told New York planners that it expects to make a profit of $3 million on the $22 million development, selling the four apartments in the building for between $3.3 million and $7.7 million.
The project is the Dunnes largest development in the US since Mr Dunne and his wife moved there in 2010.
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Dunnes change plans for New York apartment building
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With California water regulators having voted to approve fines up to $500 a day for residents who waste water on lawns, landscaping and car washing, the City of Oakdale must now come up with a conservation plan for its residents and 7,000 water customers.
The move on Tuesday, July 15, by the Water Quality Control Board came after its own survey showed that conservation measures implemented voluntarily have failed to achieve the 20 percent reduction in water use sought by Gov. Jerry Brown. Water Control Board survey results showed that water consumption throughout California had actually risen by one percent this past May compared to the same month in previous years.
Under the new statewide rules, any agency that does not impose mandatory conservation measures could be subject to state fines of up to $10,000 a day.
Oakdale City Manager Bryan Whitemyer said the city is in discussion with formulating a plan for more stringent use and have been taking complaints from the public on chronic water wasters, but education and voluntary compliance are being emphasized over levying fines.
Our goal wasnt to make this punitive, but we do have a citation process in effect, Whitemyer said.
Oakdale Public Services Director Thom Clark said the city already has a water conservation ordinance that has most of the things the water board called to have put in place and its only a matter of formalizing a final plan.
The new rules, approved by the water board, impose new restrictions on outdoor water use starting Aug. 1 that could result in fines of up to $500 per violation. The recent guidelines ban washing cars without a nozzle on a hose; watering driveways or sidewalks; using potable water in ornamental fountains; and over-watering landscaping so that water runs off into roads and adjacent properties. Recycled water is exempt.
Our fines arent as high as theirs, said Clark, stating the city gives two warnings before implementing fines.
The fines will apply only to wasteful outdoor watering, including hosing down hard surfaces such as sidewalks and driveways. They also include exemptions for public health and safety, such as allowing cities to power-wash sidewalks to get rid of human waste left by homeless people a complaint merchants repeatedly have in the city.
Clark said when studying water conservation efforts he discovered that private water trucks would hook up to city fire hydrants to fill their tanks.
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Water Plan Finalized
Pizza chain Eagle Boys cut its media spend in half for its latest digital campaign, yet saw improved results after adopting a more targeted approach, according to its retail general manager.
Nick Vincent said the company learned a lot from its first Mad Minutes campaign which offered cut price pizzas during a limited time each day for two weeks and drastically reduced its media spending in the second wave of the digital push.
The savings came after Eagle Boys scrutinised where its online traffic was coming from and directed its budget to those areas.
The first Mad Minutes campaign was a test and we did quite a hefty digital advertising campaign. But we learned a lot and in the second push we became more efficient in our media buy, Vincent said. We became more targeted and as a result spent half what we did in the first campaign and achieved better results.
He declined to reveal the cost of its media.
The fast food chain said visits to its website climbed more than 50 per cent during the fortnight with almost four in 10 of those first time customers.
A third digital push will run next month with social at its core. Vincent declined to reveal further details but said it would not be another Mad Minutes campaign although he confirmed that will return in the future.
While Eagle Boys will still use traditional channels in its marketing mix, including bits and pieces of TV, Vincent said it was increasingly turning to digital advertising.
Around one third of its marketing budget is now directed online, double that of three years ago, he said.
Steve Jones
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Targeted digital approach sees Eagle Boys halve its media spend but achieve better results
Better than Pinterest: Interior decorator Thomas Lavin and the Blake House showroom at the Laguna Design Center have merged to become Thomas Lavin at Blake House. The new combined space, open to the public, was launched with a party hosted by Elle Dcor on Sept. 16. Covetable new lines on offer include Bright and Altura furniture, Marian Jamieson lighting and Liberty of London and Anichini fabrics, along with the introduction of Christian Liaigre, Jiun Ho, Fuse, Magni Home, McEwen, Link Outdoor and Tuell & Reynolds, among others. Information: thomaslavin.com.
Social capitalism for a cause: If you like the retail activism method used by brands like TOMS, stop by a group warehouse sale from 9 a.m. to 5 p.m. Saturday and 9 a.m. to 5 p.m. Sunday to save up to 80% on clothing and accessories from local brands like Krochet Kids, Vestal, 31 Bits, Almond Surfboards, 31 Bits, Insight and Deus. The cause-conscious labels will converge at Krochet Kids HQ, 1630 Superior Ave., Unit C, Costa Mesa. Information: krochetkids.org.
Develop fashion confidence: Celebrity stylist Rebecca Pennington has opened a new designer resale boutique and styling studio, Violette Studios, at Old World Village, 7561 Center Ave., Suite 51A, Huntington Beach. In addition to offering deals on top labels, the venture plans to offer weekly and monthly events to help people of all ages learn to dress for their lifestyle. Stop by the grand opening at 11 a.m. Saturday to learn more and enjoy music, food, door prizes and shopping. Information: violettestudios.com.
Study buddies: The Newport Beach Public Library will host a free SAT Practice Test from 10 a.m. to 2 p.m. Saturday at its Central Library Friends Room. Students of any age may participate; results will be emailed within two weeks. Register soon at newportbeachlibrary.org since space is limited. Registration is required. The test will take about four hours; bring a calculator.
Wine and dine: The new Hyatt Regency Huntington Beach Resort & Spa signature restaurant Watertable, 21500 Pacific Coast Hwy., will begin a series of monthly wine dinners at 6 p.m. Sept. 30, when it welcomes Napa Valley's famed Heitz Wine Cellars to pair its bottles with dishes including Yellowtail Hamachi Crudo, Organic Beet Tartar, Maple Leaf Farms Duck Breast, Espresso Rubbed Short Rib and Fall Harvest Black Mission Fig Tart. Future dinners will be Oct. 30 and Nov. 12. The dinners will be $95 to $135 per person, plus tax and gratuity. RSVP at (714) 845-4893.
Autumn bounty: Join chef Pascal Olhats and special guests Anne and Dan Manassero from Manassero Farms at 5:30 p.m. Sept. 25 at the Sherman Library and Gardens, 2647 E. Coast Hwy., Corona del Mar, to learn about growing vegetables and enjoy a cooking demonstration and French countryside feast by the chef. The monthly interactive dinners are limited to 50 guests, and the cost is $50 to $60 per person. Information and reservations: (949) 673-0033.
Have a hot sale tip, or know about a new local business that you think deserves a little attention? Contact CANDICE BAKER at candicebaker@gmail.com.
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Retail Therapy: A merger by Design
