New home starts for the month of January fell to a level of 173 units, a 24 percent decline from December 2022’s total, according to statistics compiled by the Home Builders Association of Greater Kansas City (KCHBA). The lower permit activity in January is consistent with national trends which have indicated that new-home starts are low due to would-be homebuyers balking at the higher, somewhat volatile interest rate environment in addition to the higher carrying costs builders are facing.

“Housing starts are always going to lag home sales numbers. Given the increasing number of sales we’ve seen at the outset of this year coupled with a historically tight level of inventory, I expect to see the number of permits gradually increase as the year progresses,” said Will Ruder, executive vice president of the KCHBA. “It’s understandable that a buyer would want to wait in order to get the best deal possible. But given the huge pent up demand for housing competing for limited supply, the sooner a buyer takes the necessary steps to secure their future home, the more likely they will beat the rush when conditions stabilize.”

Kansas City, Mo., begins 2023 at the top of the list for highest-permitting cities with 29 single-family units. Overland Park ranked second with 24 units, followed by Olathe with 16 permits issued. Rounding out the top five are Belton with 13 permits and Liberty with 11 permits issued in January.

Click here to view the January 2023 Residential Statistics Report.