A 20 year history of single family home building permits in Harrisonburg and Rockingham County (shown above) reveals that much of the new home construction is market driven.  The past twenty years can be summarized in four main stages:

• Gradual, but uneven growth (1990-2002) -- building permits increased some years, and declined some years, but increased overall, as employment opportunities and the population increased in the central Shenandoah Valley
   
  
• Rapid expansion (2002-2005) -- new construction boomed, in tandem with the housing market, and median home prices
   
  
• Rapid correction (2005-2008) -- new home construction levels dropped quickly, well below historical trends
   
  
• Continued, gradual correction (2008-2010) -- new home construction slowed to the lowest level in 20 years but at a slower pace

The good news for builders and developers is that current levels of new home construction are below historical trends in Harrisonburg and Rockingham County.  Eventually, new home construction will increase in pace again.  The bad news is that it is going to take some time for the new home market to fully recover -- and the process is slowed down by foreclosures, and high inventory levels.  One last hope for good news is that (locally) the foreclosure rate and inventory levels are both on the decline!  
  
Data Source:  Weldon Cooper Center