UP 414%

According to SmartMoney, though new homes have been out of favor for a few years, construction rose 1.5% in January nationwide. Where is the fastest growth? 


You guessed it, Washington D.C.

According to the article:

     + December 2011 compared to the year prior: up 414%


Building permits are up more than 400% in the nation's capital, but experts are quick to point out that the number is still small compared to before the housing downturn. But government jobs continue to attract more residents to the nation's capital, which in turn is creating more demand for housing, says McCabe. For builders there are two big advantages to developing new housing in the nation's capital: Nearly all of the district's building permits in December were for multi-unit properties suggesting that rental demand is rising. There are also incentives to build single-family homes to sell: The area is one of just two major metro areas where home prices are actually up year over year.


The latest S&P/Case-Shiller Home Price Indices for November 2011 shows home prices are up 0.5% compared to the prior year, and while that change is small, it's better than most other major cities, which are down. With fairly stable prices, developers are less at risk of losing money on new homes or selling them at a fraction of their original asking price, says McCabe. 


And unlike states that experienced a building boom prior to the recession, developers don't have to compete with excess unsold inventory in Washington, D.C. or foreclosures. Less than 1% of homes in the D.C. metro area received foreclosure filings in 2011, according to RealtyTrac.com.