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Theresa Young is ready to quit renting and buy a home. ¶ She and her husband rented a home in Stone Mill Farms last winter when they relocated from Florida to Woodbury. This summer, they took the plunge and bought a lot to build a three-bedroom, 2,300-square-foot home in the same development.

"It's still a little bit scary with the unknowns of the economy, but I don't know that prices are going to get any lower," she said. "It's a bit of a leap of faith, but it seems to be the best time to do it."

The Youngs are not alone in that leap. New numbers from around the metro area indicate home construction is beginning to pick up after record lows last year and in 2008.

City officials describe a cautious but hopeful attitude toward new home building this summer.

A spot check of new housing starts in a handful of Washington County cities found Oakdale, Woodbury, Cottage Grove and Forest Lake have already issued more permits this year than in all of 2009.

Woodbury and Hugo are pockets where high activity is taking place. Woodbury leads the entire metro area in terms of planned units for 2010, as well as the valuation of permits issued, in part, because of a boost from a large apartment complex.

Although there was demand created by the home-buyers' tax credit earlier this year, general concern about the economy's recovery lingers.

Builders and city officials said it's unlikely home building will ever return to the boom days of the late '90s and the earlier half of this decade, when rapidly growing Woodbury peaked at more than 1,600 new units a year.

"Those were some unique years when we had those high 1,600 units," said Janelle Schmitz, the city's planning and economic development manager. "I don't know any of us really misses those large, large numbers."

Through the end of July, Woodbury had approved 98 permits for 373 units valued at $49.8 million.

We're over where we were last year," she said. In 2009, 255 units were approved, which was "the second-lowest year we've had in 20-plus years of history. We're happy to have surpassed that."

The city's comprehensive plan calls for steady growth of about 600 units per year, Schmitz said.

Hugo is the other Washington County city with a fair number of new homes going up, according to Mike Swanson, past president of the Builders Association of the Twin Cities.

In addition to the growth in new housing starts, Swanson said traditional sales are evening out as well.

The Twin Cities market is much more in balance as far as the amount of inventory, he said. It currently has about a six- to seven-month supply of houses. A market is considered balanced at four to six months' supply, Swanson said.

According to a Builders Association report, other metro-area hot spots for new home construction are Maple Grove, Blaine and Shakopee.

Builders say consumer interest in building new homes has been steady, but buyers are more cautious than in the past.

Jon Aune, director of land operations for Lennar, said consumers are buying "inventory homes," rather than pre-purchasing, which has been a major shift. Inventory homes are purchased after construction has started.

"When times are very good, we had very few inventory homes," he said. "Now a good portion of our homes are inventory homes."

In the slowest times last year, Aune said Lennar offered large incentives such as rate buydowns to entice buyers. This year the company backed away from those, he said, and moved toward smaller incentives, such as closing cost deals or landscape packages, a sign that buyers are requiring a less aggressive package.

Another major builder, Pulte Group, just purchased 39 lots in Cottage Grove and started construction on the model homes this week. Marv McDaris, Minnesota division president, said it already has names of about 40 interested potential buyers.

McDaris said the most popular home plans they're currently building are between 2,300 and 2,500 square feet. In the boom time, the most popular homes were a couple hundred square feet larger.

Emma L. Carew • 612-673-4154