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2011 marks third-lowest year on record for California housing production

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From page C6 | February 03, 2012 |

SACRAMENTO – California saw the third lowest yearly housing permit total and the worst yearly total on record for single-family units in 2011, the California Building Industry Association announced.

CBIA officials said a total of 47,015 permits were issued statewide last year for new homes, apartments, condominiums and townhomes, up 5 percent from 2010 when 44,762 permits had been issued. The 2011 total was still down 28 percent from 2008, which had held the distinction of the third lowest total on record with 64,962 permits issued. Records began being kept in 1954 with the lowest yearly total set in 2009 with 36,421 permits issued.

According to statistics compiled by the Construction Industry Research Board, homebuilders pulled permits for a record-low 21,420 single-family homes in 2011, down 16 percent from 2010. Multifamily permits totaled 25,595, up 33 percent from the previous year.

“If these numbers are any indication, especially with the single-family permit total being the lowest on record since 1954, we are far from being out of the woods just yet,” said Mike Winn, CBIA’s president and CEO. “Perhaps the only positive aspect to take away from this is that the numbers are at least headed in the right direction. We strongly encourage lawmakers at the state and local level to seriously examine any measures that might harm the housing industry and further impair a broader economic recovery.”

For the month of December, permits totaled 5,291, down 21 percent when compared to December 2010, but up 15 percent from November. It was also the highest monthly total in all of 2011. Single-family permits totaled 1,899, down 44 percent from December 2010 but up 20 percent from November, while multifamily permits totaled 3,392, up 3 percent from December 2010 and up 12 percent from the previous month.

Ben Bartolotto, research director for CIRB, noted that it is difficult to compare the December 2011 numbers with the same month a year ago as many builders rushed to pull permits at the end of 2010 to avoid code changes and new regulations.

Winn noted that in this case, it was most likely the costly new fire sprinkler regulations that became mandatory in 2011 and would add anywhere from $3,000-$8,000 to the cost of constructing a new home.

Bartolotto also noted that CIRB is now projecting 57,000 total permits will be pulled in 2012, a 21 percent increase from 2011, but still down from 2008.

“We hope for more robust homebuilding activity in 2012 but it appears we will be forging ahead on a long road back to healthy productions levels,” said Winn. “The sooner we get job-generating home construction back to healthy levels, especially in the single-family sector, the better it will be for our overall economic recovery.”

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