As the national economy continued to slowly come back to life residential permit issuance lost its footing in the first quarter of 2011.  According to the 1st Quarter 2011 Edition of the newly released Flash Report, activity in the single-family segment was 22% below the level seen during the same period last year.  The current pace of 90,400 detached homes permitted during the quarter was 26,000 permits below the year ago pace.  As the for-rent apartment market continues to heat up in response to steadying job growth, multifamily permit issuance has continued to trend upward. 

Based on current trends we expect to see continued weakness in single-family construction activity. While demand for housing has increased recently, given the steady rate of job growth, many buyers are continually opting to purchase existing or distressed home instead of higher-priced newly built alternatives.  Conversely, demand in the for-rent segment will remain high as new households are formed and those consumers move into the for-rent segment. Homebuilders across the nation are adjusting to the new normal that their businesses are now operating in. For many, this means smaller projects in central locations near jobs and existing amenities such as shopping and recreation areas. Through the end of 2011 we expect new home construction to remain just below the pace seen last year.