DataMarkets & Economy

Housing permits struggle to keep pace with employment growth

Is it time for builders to crank up the pace?
  • Throughout the nation, two-thirds of the 146 metros measured in the second quarter of 2016 saw homebuilding lacking behind employment growth.
  • The first two cities reported by NAR with the biggest gap between employment growth and single-family housing permits were in California: San Jose and the Bay Area.
  • In Houston, the three-year change in employment to the total permit ratio was 1.9, with 158,364 new total permits.

Oakland / cdrin / Shutterstock.com As the job market continues to improve, the need for more properties follows suit. According to a National Association of Realtors Metropolitan Median Area Prices and Affordability and Housing Affordability Index, homebuilding of all housing types was under-performing in about two-thirds of the 146 metros measured in the second quarter of 2016. NAR measured home construction compared with the number of newly employed workers to determine whether builders are able to keep pace at a sustainable level. Overall, inventory was failing to keep up with the demand for housing in many parts of the country during the second quarter, according to NAR. At the end of the second quarter of the year, there were 2.12 million existing homes for sale, which is lower than the number of homes available the same time the previous year. The lack of inventory in parts of the country drove more the 40 percent of the nation's listings to sell for more than the li...