Via Elliott Pollack.

The most often asked question over the past few weeks is about the local housing market. R.L. Brown’s data indicates that the number of new home permits in Greater Phoenix was down 26.8% in January compared to a year ago. In Greater Tucson, the decline was 18.5%. What happened? Was it an even lower rate of population growth? Was it the change in the maximum level of an FHA loan? Was it that the uncertainty over Dodd-Frank has caused private lenders to avoid the mortgage market? Was it the change in affordability from a year ago? Was it the weather back east? Was it the retrenchment of investors in the single family market? Was it simply an aberration? Anecdotal evidence suggests that traffic was up, but conversion of traffic to sales was slow. Some builders also express concern over the effects of the lower loan limit and the unintended consequences of Dodd-Frank. The level of job creation seems to indicate that population growth should continue at a modest level. The fact is that no one knows for sure at this point. But, the answer will become clearer over the next couple of months. We will follow this closely.

I’m going to be diving into the numbers in posts later this week so be sure to subscribe (upper-right corrner) if you aren’t already.

ADDED: My guess is the number #1 factor was this, “Was it the change in affordability from a year ago?”.