RealtyTrac: Building Permits Rise as Foreclosure Starts Decline

On a national level, the relationship between building permits and foreclosure starts resembled that of a seesaw in the first quarter, with an equal but opposite rise and fall, but in some markets, both permits and foreclosures are on the rise, according to a ""report"":http://www.realtytrac.com/content/foreclosure-market-report/building-permits-and-foreclosure-starts-first-quarter-2013-7724 from ""RealtyTrac"":http://www.realtytrac.com/.

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After analyzing data from ""HUD"":http://portal.hud.gov/hudportal/HUD, the online foreclosure marketplace found single-family building permits increased 27 percent year-over-year in the first quarter to the highest level in five years, while foreclosure starts fell 27 percent during the same time period to the lowest level since the second quarter of 2006.

Meanwhile, multifamily building permits trended upward, increasing overall by 23 percent. Overall, single-family homes accounted for 64 percent of total permits.

""Nationwide and in most markets it appears builders are planning to ramp up activity that will help offset a drop in foreclosure starts, but there are some markets where a jump in both building permits and foreclosure starts in the first quarter indicate the scales will tip more heavily in favor of supply of homes for sale in the coming months - both new homes and foreclosures,"" said Daren Blomquist, VP at RealtyTrac, in a release.

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""On the other extreme there are some markets where both building permits and foreclosure starts are down dramatically, indicating that there will be no reprieve from the shortage of homes for sale in those markets in the near future,"" he added.

According to RealtyTrac's analysis, the five states that led with the most single-family building permits in the first quarter were Texas, Florida, North Carolina, California, and Georgia.

All five states registered double-digits gains compared to a year ago, and all states also experienced decreases in foreclosure starts over a one-year period, though Florida's drop in foreclosure starts was just 1 percent, RealtyTrac noted.

Out of the top five cities with the most single-family building permits, four were in Texas. Houston was No. 1, followed by Oklahoma City, Austin, El Paso, and Fort Worth. With the exception of Austin, all cities experienced decreases in foreclosure starts.

On the other hand, RealtyTrac data showed Miami, Las Vegas, Chicago, Fort Lauderdale, and Orlando posted the highest number of foreclosure starts in the first quarter. Single-family building permits also increased in all five cities compared to a year ago, while foreclosure starts rose year-over-year in Las Vegas, Fort Lauderdale, and Orlando.

A handful of cities saw both single-family building permits and foreclosure starts rise by at least 10 percent year-over-year in the first quarter, including Las Vegas; Seattle; Raleigh, North Carolina; Reno, Nevada; and Boca Raton, Florida.

Cities where building permits and foreclosure starts fell included San Antonio; Albuquerque; Fresno, California; Bakersfield, California; and Greensboro, North Carolina.