Low Housing Inventories and Markets Most Affected: Part 3
In many metropolitan areas, critically low inventories and subsequent skyrocketing home prices and rental rates are locking out new home buyers and impeding moves at a time when the economy is growing and employment is high. This is the third factoid in a series of five factoids that zeros in on markets hit the hardest with the housing shortage and those that are fairing better.
While many metro areas are suffering with tightening housing inventories, some areas are having better luck with building permits and new housing construction in an attempt to turn the tide. Furniture retailers should pay close attention to the markets where building is picking up and where building is slowing. Overall building permits grew 6.6 percent in the U.S. 2017 Q2 to 2018 Q2 annualized. Interestingly, it is the smaller markets where building permits have increase, specifically for single-family units. The larger MSAs, 500,000 to 1.5 Million and Over 1.5 million housing units, had the smallest growth over last year, 4.8 percent and 5.8 percent respectively. Mid-size range 250,000 to 500,000 increased the most at 9.4 percent, while the smallest range available (50,000 to 100,000) had the second highest growth at 9.3 percent. of 4.6.
Looking at state increases in building permits in 2018, Hawaii had the highest growth in residential building permits since the second quarter of 2017 -- jumping 32.6 percent followed closely by New Hampshire at 30.9 percent. Idaho, Utah, and North Carolina all had over a 20 percent increase.
Building permits declined in many states. Montana had the lowest growth in residential building permits declining 23.7 percent this year compared to 2017, followed by Mississippi, down 20.5 percent, and Illinois falling 15.7 percent.
Source: U.S. Census Bureau Building Permits, unadjusted
Note: Data includes all states