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More on Housing Supply and New Construction


A few days ago I wrote about the contribution of home builders to the overall supply of homes in the Austin area (see Housing supply in Austin?)  Today, I want to add a comparative view of the data I discussed in that post.

The original post mentioned that from 2006 to 2017 the number of single family building permits was down about 20% and Austin metro population was up almost 40%.  Obviously, that’s not good news, but consider what it means in absolute terms:

(To calculate how many units were needed in the 5-county metropolitan area during this period, I assumed an average of 2.4 people per household.)

During that time period, there were 315,676 resales of houses, condominiums, and townhouses across the 5-county metro area reported via the Austin-area MLS system.  Those transactions included 2 or more sales of some properties — analysis that I have not done.  Also, some new Austinites purchased other types of property (mobile and manufactured homes, half-duplexes, etc.) and many others rented single or multi-family residences.  That said, there were credible estimates in 2017 that we were 48,000 dwelling units behind the needed supply.  Moreover, Austin’s Strategic Housing Blueprint, which was incorporated into the Imagine Austin comprehensive plan last year, calls for the creation of 135,000 new dwelling units over the next ten years — in the City!

That’s an average of 13,500 per year in Austin compared to an annual average of 9,514 permits issued over the past ten years across the entire metro area, and it doesn’t include the additional 4,800 units annually to make up the 48,000 unit existing shortage.

We are far from resolving the supply vs. demand imbalance in our housing market, and even as the market cycle shows some signs of maturity.  I’ll have more to say on this as the year goes on.

About Bill Morris, Realtor

More than thirty years of business experience (high tech, client service, business organization and start-up, including many years in real estate) tell me that service is the key to success and I look forward to serving you. I represent both buyers and sellers throughout the Austin metropolitan area, which means first-hand market knowledge is brought to bear on serving your needs: -- Seller Representation is a comprehensive process that begins with thorough market analysis and consultation, continues with properly staging the home to achieve the highest price possible in a reasonable time on market, a complete program of marketing and promotion, ongoing updates and communication, closing coordination, and follow-up throughout (and after) the sale. -- Buyer Representation is also full service: shopping, previewing, price and market consultation, contracting, negotiating, coordination of inspections, appraisals, repairs, and closing details, and follow-up beyond the closing of your purchase to ensure your lasting satisfaction. Because the real estate industry is becoming more sophisticated and challenging every day, you need a professional that understands the industry and is positioned to stay ahead of the game. I go the extra mile to help you achieve your goals. That's why I constantly research the market and property values so your home is priced effectively from day one. I also make sure the public knows your home is for sale by using innovative advertising and marketing techniques to attract potential buyers.

Discussion

2 thoughts on “More on Housing Supply and New Construction

  1. Know that for every 3 jobs should equal one home start.

    MS

    Posted by Mark Sprague | January 9, 2018, 1:24 PM

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  1. Pingback: Building Permits and Housing Mix | Bill Morris on Austin Real Estate - November 25, 2018

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