Published: February 12, 2008 08:45 am            

New home construction drops 14.4%

Still ahead of state, national trends

Permits for new home construction across Madison County fell 14.4 percent in 2007, when 504 were issued compared with 589 in 2006.

The year 2005, when 802 construction permits were issued, was probably the best year ever for local home builders, said Ron Weaver, executive officer for the Madison County Home Builders’ Association.

The numbers may be skewed somewhat because home renovations, as well as new construction, also require a building permit. Also, after a permit is issued, a project may be canceled, local officials said.

While last year’s drop was significant, Madison County’s statistics still run counter to state and national trends.

Across Kentucky, home construction was down 18.6 percent, according to the U.S. Census Bureau’s Web site.

Nationwide, the decline was even worse, 24.8 percent, the biggest drop since 1980.

In Berea, home construction went against all trends in 2007, climbing to 96 from 76. However, that increase came after a steep drop from 2005 when 116 single-family home construction permits were issued.

New homes constructed in Berea for 2007 were valued at $9.94 million, up from $8.64 million the previous year, said Kerry Hensley, the city’s codes enforcement officer.

After falling significantly from 2005 to 2006 — 248 to 214 — home construction permits issued by the city of Richmond fell slightly in 2007 to 206.

Home construction in Richmond was valued at $20.3 million in 2005, falling to $16 million in 2006 and $14.7 million in 2007, said Joe Lillis, the city’s director of codes enforcement.

Outside of Madison County’s two cities, 438 new home construction permits were issued in 2005. They dropped 29.4 percent the following year to 299. The steep decline increased in 2007 as construction permits fell 32.4 percent to 202.

Madison County home construction outside the two cities was valued at $63 million in 2005, dropping off to $38.7 in 2006 and $31.3 in 2007, said Duane Curry, administrator of the county’s planning and development department.



Through 2005, much construction growth took place in the northern section of the county off Exits 95 and 97 of Interstate 75, said Reagan Taylor, president of the Madison County Home Builders Association. “It’s definitely slowed in the past two years,” he said.

Home prices and taxes are much lower in Madison than Fayette County, he said. That helped make northern Madison County popular because, “People can live in a subdivision off Exit 95 or 97 and be less than 15 minutes from Hamburg Place (Exit 108).”

Taylor attributed part of the decline in construction to the high price of fuel.

A few local builders have gone out of business in the past two years and one multi-state building firm, Beazer Homes, which has built homes in Madison County, recently announced it is pulling out of central Kentucky.

“This is a time when the strong will survive,” Taylor said.

Madison County is still “a prime location for home construction,” Weaver said. “You can see that when you compare local to state and national statistics.”

The Madison County Home Builders Association has about 60 builder members and 140 associate members.

Bill Robinson can be reached at brobinson@richmondregister.com or at 623-1669, Ext. 267.

        

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