Since housing activity is a key economic gauge, officials hope Fort Wayne is galloping up the comeback trail.
The Home Builders Association of Fort Wayne on Monday reported the number of residential house construction permits in Allen County increased 21.7 percent to 839 last year. In 2012, 689 building requests were submitted, resulting in just a 1.3 percent year-over-year increase.
The Home Builders Association also reported a spike in the average home construction cost, increasing from $226,051 to $227,492 in 2013.
Lonnie Norris, vice president of sales and marketing for Granite Ridge Builders, was aware of the county’s good showing last year. The company recorded about $60 million in sales, up 20 percent from 2012.
Granite Ridge sold about 285 homes last year throughout northeast Indiana.
“We had a little carryover (inventory) from 2013,” Norris said, “People are buying homes because money is cheap with interest rates between 4.5 and 5 percent for a 30-year fixed mortgage.”
In August, Allen County commissioners approved the builder’s Saddle Creek Estates, a subdivision near Grabill. Granite Ridge wants to build the 102-lot subdivision on Witmer Road. Homes will range from $175,000 to $250,000.
“I’d say $213,000 was about average in 2013,” said Norris, adding that the Saddle Creek project will be on 2014’s books. “This is good for the economy. People are saying, ‘I have a stable job, I’m ready to buy.’ ”
David Dilts, professor of economics at IPFW, said he in no way wants to be a killjoy but thinks residents should view the building permit totals with some skepticism.
“That’s sort of amazing that we have those kinds of numbers,” he said. “Of course, it’s one thing to pull a permit and another thing for it to become a housing start. Still, the results are a good indicator that starts will follow.”
Dilts remained guarded, though.
“I would dearly love to think that Fort Wayne is seeing increases in salaries, in population and in other areas to substantiate the number of building permits, but the numbers don’t support it.”
For example, Northeast Indiana Regional Partnership has made encouraging higher pay scales among employers a priority. An initiative showed the area’s average per capita income of $35,509 lags way behind that of Des Moines, Iowa, which ranked No. 1 at more than $45,000 for similar size cities.
But something is happening, Dilts said.
“There could be younger people with growing families wanting to trade up, and older types like me wanting smaller places,” Dilts said. “One thing’s for sure and that’s our friendly local builders have seen something to give them a reason for optimism.”
Greg Gerbers, vice president of the Home Builders Association of Fort Wayne, calls it demand.
“This is good to see and it’s a good barometer for the local economy,” he said. “We still have a ways to go, but I believe we’re headed in the right direction.”