With the economy still in recovery mode, buyers and builders are more cautious than ever when it comes to purchasing and constructing new homes and businesses. But there seems to be a positive outlook for the real estate market, according to the University of Hawai'i Economic Research Organization's (UHERO) quarterly forecast.
The UHERO report shows continued growth with private building permits in the state increasing for the third consecutive quarter--the last time this occurred was in 2006. Residential permits are up 20 percent from last year with moderate upward movement for commercial permits.
With the increase in permitting and a tripling of government contracts awarded in the second quarter of this year, UHERO expects construction jobs to end 2012 with a .6 percent rise from 2011. That slight rise is expected to jump to 7.7 percent in 2013, indicating Hawai'i may be in the midst of the next home building cycle.
"Confidence amongst home builders is gaining momentum, and that bodes well for not only the real estate market, but the entire economy," said Ken Laughlin, president of Hawai'i Lumber Products Association.
"An increase in building of new homes and businesses means an increase in not only construction jobs, but an increase in jobs and sales for many related vendors."
Construction growth is most evident on the west side of O'ahu.
This upward trend in the real estate market isn't just reserved for Hawai'i. The Commerce Department reported nation-wide building permits in September rose almost 12 percent from August to a seasonally adjusted annual rate of 894,000, which is over a 45 percent jump from a year ago. Housing projects broke ground at a seasonally adjusted annual rate of 872,000 to a nearly 35 percent increase from September 2011.