Banks increased their lending to single-family homebuilders in the first quarter by $2.3 billion, nearly 18% higher compared to the same quarter in 2015, according to a new report by the National Association of Home Builders.
As of March, the outstanding stock of one- to four-family residential construction loans rose to $63.2 billion, according to the group's analysis of recent Federal Deposit Insurance Corp. data.
"The year-over-year growth of 18% in construction lending is consistent with our 2016 forecast," said Robert Dietz, the group's chief economist.
NAHB's forecast calls for 806,000 single-family starts this year, up 13% from 2015.
However, builders are noticing some tightening on the part of community banks and other lenders.
"Lending is still in the easing territory but the rate of that easing has been slowing in the past few quarters," Dietz said in an interview on Monday.
He also noted that easing has been focused more on construction loans than on land acquisition and development loans. The supply of developed lots is a continuing headwind for small and midsize builders.
Overall, FDIC data shows that outstanding acquisition, development and construction loans totaled $284.2 billion as of March 31, up 14% from a year ago. AD&C lending data includes loans for commercial building, multifamily and single-family projects.
