Stronger construction spending in the housing market is on the horizon in 2015 for Nevada, despite lingering foreclosures that need to be removed from bank books.
The Portland Cement Association (PCA) expects a 17% increase in housing permits in Nevada this year. The forecasted increase is driven by expected growth of 12% in single-family units and 29% in multi-family units. Although, the state still holds a significant percentage of mortgages in foreclosure and pre-foreclosure that drags down the speed of the recovery when compared to other states, the low interest rate environment, affordable home prices and easing of lending standards, will allow homeowners to once again drive demand for residential construction. The numbers indicate that a third of Nevada homeowners will remain underwater, which is currently the highest in the nation.
Following a surge in single-family housing permits of 59% and 21% year-on-year growth in 2012 and 2013, the market cooled last year as permit activity declined one percent. Nevada’s housing construction market remains 73% off past peak levels and 67% below pre-bubble peaks.
Adapted from press release by Katherine Guenioui