Tuesday, April 17, 2012

Housing Riddles

So here is a riddle.  Population in the region is ticking up for the first time in decades.  Net migration is actually net positive for at least 3+ years now which has little precedent here in almost a century.  We know we have one of the oldest housing stocks in the nation and mimimal new construction in recent years.  So where are the new folks living?  If you look at the numbers not only is there no big uptick in housing supply on the horizon, but it looks like the rate of new housing units coming online here is lower than in parts of the 1980s.  So says the data on the number of building permits issued monthly:

The answer in part lies in the more interesting factoid to come out of the recent migration data.  Allegheny County showed net positive migration for the first time in many decades.  It was not a big net migration number, but the point is that it was not a big negative number which had been the pattern going back longer than it matters to count.  Back in the 1980s the region was seeing tens of thousands more leaving than coming each year, yet there was still new construction.  Why? Because there was still a big flow out of the urban core and into suburban municipalities, many of which were building out rapidly despite the overall regional malaise.

So there is a certain Zen to how all the numbers work out (isn't there always?).  Now the population decline is at least temporarily abated, but with Allegheny County holding it's own the big source of housing construction in the suburbs is diminished.  Plenty of places in the region's traditional centers that could accomodate a lot of new residents without a lot of new construction.  Probably a lot of investment needed in existing housing along the way.


Blogger BrianTH said...

So some of them just eliminated vacancies--obviously, though, that is not a sustainable trend.

Tuesday, April 17, 2012 12:08:00 PM  
Blogger JRoth said...

This is a point I've brought up many times with now-Slate blogger Matthew Yglesias: the urban centers of America's old industrial cities have thousands - tens of thousands - of units of empty housing units, such that every new resident doesn't require a newly built unit (or even close). And when you're talking about fixing up a previously empty, but not decrepit, unit, there's not always a building permit.

I'd add that a fair number of the units being built at a good clip going into the recession remained empty throughout the recession, so there are never-occupied units available, even if they're not literally new.

Last thing: while single family houses in tracts go up pretty quickly, urban residential, whether townhouse or apartment conversion, tends to take longer. The 60-odd apartments in the Century Building, for instance, were permitted in 2008, but went on the market in 2010. And a lot of projects were slow-walked through the bottom of the recession: I'd bet that the average time from permit issue to occupancy stretched considerably after 2007.

Wednesday, April 18, 2012 11:01:00 AM  
Blogger JRoth said...

obviously, though, that is not a sustainable trend.

Not forever sustainable, but let's be clear: the city lost forty thousand households between 1980 and 2010, but the net change in housing units was about 20,000. Some chunk of that surplus are decrepit, but there are thousands of viable, empty housing units out there, just awaiting immigrants.

Also: I'm pretty sure that the typical city commercial building with an occupied storefront and long-empty apartments upstairs is listed in the statistics as 0 housing units (I say this because, IME, there's no occupancy permit for the upstairs units). Now, those units can't be legally occupied without a permit showing up in the city's stats, but it's a latent supply of housing units that require renovation, but no new construction.

Wednesday, April 18, 2012 11:31:00 AM  

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