Magazine article American Banker

Housing Boom Projected to Reach 13-Year High in '99

Magazine article American Banker

Housing Boom Projected to Reach 13-Year High in '99

Article excerpt

Housing permits will grow 6% this year, to nearly 1.7 million units, which would make 1999 the busiest construction year since 1986, according to U.S. Housing Markets.

Brian H. Bragg, editor of the housing research journal, said the country's demographics will boost the housing sector though interest rates rise.

"We are in a period in the housing industry where we have a larger than normal number of people advancing into their homebuying years," Mr. Bragg said. "Baby boomers in that hot, 35- to 55-year-old age group need to buy and rebuy houses."

Mr. Bragg said several other factors will contribute to a potentially record-setting year.

"This is the greatest peacetime economy we have seen in this country," he said. "Plus there has been a great flow of immigrants, and they tend to want to own homes. If they bring money with them, segments of the country are helped immensely by foreign populations. Just look to the boom on Wall Street-a lot of people feel confident, even if they're not cashing in. They feel wealthy and able to buy a new or bigger house."

Texas, where the publication has forecast a 15-year high of 175,000 home building permits will be issued this year, is expected to be the busiest in housing construction. That many permits would amount to an 11% gain from last year.

"The job growth in Texas is tremendous, and in-migration is great to the state," Mr. Bragg said. "The growth is in good, high-paying jobs, not just hamburger flippers. Oil prices are rising, and there are a lot of high-tech companies going in there. …

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