Even though recent reports and data show a national decrease in the number of new homes being built, the Chapel Hill housing market might be improving.

According to a recent report from the Daily Tar Heel, in October, housing starts dropped countrywide after gradually trending upward since January. The number of units started fell about 11 percent from September, according to a U.S. Department of Housing and Urban Development report released last week. The number is also down about 31 percent from October 2008.

Local realtors and developers cited a government tax credit for home buyers as a main reason for the market’s recent growth. The credit was set to expire Nov. 30, until the U.S. Senate voted to extend its availability through April.

Roger Perry, president of real estate development company East West Partners and a UNC trustee, said the national drop in housing starts may be explained by the credit’s potential expiration and may be a blip in the overall trend.

“Demand is driven by the job situation,” he said. “The number one determiner of what the market is like is job growth, not housing starts.” Employment in Orange County grew less than 1 percent from August to September, to 64,311 people.

Scott Kovens, owner of both Kovens Construction and Capkov Ventures, said the tax credit is essential to sustained growth in the real estate market.“Most business lately has been first-time buyers who never would have gotten into the market without the credit,” he said. “They really need and deserve this tax credit.”

Kovens also said the decrease in starts could be a blessing. “We need to be cautious not to overbuild. Having excess inventory hurts everybody down the chain,” he said. “Less housing starts could be a good sign that people are proceeding with caution.”

With most of that excess inventory having been cleared out, housing starts will likely increase again over the next year, Perry said.

Meadowmont Realty owner and broker Clarence Lupton, who hosted four open houses on Sunday, said the stability of the local economy will help the housing market continue to progress.

Palo Alto, Calif., resident Ken Scott, who toured one of Lupton’s open houses, said economic conditions would not substantially impact his decision to buy a new house.

“We’ve been in the same place for 28 years, and the economy’s changed many times,” Scott said. “We’re ready to move.” Kovens said Chapel Hill is a prime area for economic recovery.

“This community is not artificially sustained. An automobile plant might close, but the University and the hospitals won’t,” he said. “Here, people can have the confidence to move forward.”