Posted on July - 18 - 2011
Permits Continue Strong in Texas and Carolinas
Nineteen cities are issuing housing permits at twice or more the rate per population as the rest of the country. Five cities are in Texas, with two more just over the border in Louisiana and Arkansas and six in the Carolinas and one just over the border in Georgia. The list also includes Des Moines and Omaha, close together in the central plains plus Nashville, Provo and Bradenton-Sarasota.
All of these cities are attracting new workers and businesses because of their low cost for both workers and business. Each of them has positive net immigration from elsewhere in the US in recent years through 2009 which likely is continuing. Also, each of these cities, except Bradenton-Sarasota had a relatively mild housing recession. Home price declines were very low because there was very little price surge in 2004-06. In turn, there was little price surge because the use of subprime mortgages was small and permitting was relatively quick and inexpensive so the housing supply was not seriously constrained.
Twenty local markets have more building permits in the last three months than during the peak of the housing boom in late 2005 – early 2006. There are no large cities on the list. San Jose appeared briefly with a large spike in multi family permits last December. Each city has its own unique source of new jobs and new workers which more than offsets depressed national housing market trends. The dominating local trends include countercyclical expansion of local universities, military bases and newly discovered oil and gas fields.
Housing permit issuance in most of the large housing markets is well below the housing peak level and continues to ebb lower apart from the brief surge and collapse of permits caused by the homeowner tax credit.
Atlanta, long the largest housing market, has been at the top of this list for several years. The other extremely depressed housing market is Cape Coral-Ft. Myers which is by far the smallest market on the list.
The top single family permit list continues to be dominated by Texas and Carolina housing markets as well as Washington. The Houston housing market is now nearly twice as large as any other market.
Many of the same cities are also in the list of top twenty multi family markets along with Boston, San Jose, Miami, Minneapolis and San Francisco — where high land cost favor multi-family construction.
For more information, please see US Metro Housing Markets – March 2011 – Cities 1-180.
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