By ANDREW KEATTS, The Daily Transcript
Thursday, February 24, 2011
If January was any indication, housing construction might be on a modest upswing in 2011.
San Diego County jurisdictions granted permits for the construction of 466 housing units in the first month of the year, more than were granted in any of the last three Januarys, and more than in all but one month of 2010, according to numbers released by the Construction Industry Research Board (CIRB).
Of the 466 permits pulled by developers last month, 309 were for the construction of multifamily units, with the remainder reserved for single-family homes.
County developers received 87 and 285 housing permits in the first months of 2009 and 2010, respectively. The yearly totals of 2,990 in 2009 and 3,342 in 2010 are the two lowest on record. In 2008, when 5,154 total permits were issued, 317 of those came in January.
“It’s still anemic,” said Mark Riedy, executive director of the Burnham-Moores Center for Real Estate at the University of San Diego, of the 466 permits issued in January. “I just can’t get excited about that. It might be more than the last three years, but the last three years have been anything but good.”
Compared to the monthly totals in 2010, last month would have trailed only June’s 559, and would have finished just ahead of the 440 pulled in May. There were 292 permits pulled in the last month of the year, after three successive months below the 200 mark.
“If we were to analyze this number, 2011 would far exceed what we saw in ’08, ’09 or 2010,” said Borre Winckel, chief executive officer of the Building Industry Association of San Diego (SD-BIA). “This is an affirmative statement about the intent of new construction.”
Though the numbers are expressed as a countywide total, Winckel says a select few jurisdictions, namely Chula Vista, are responsible for the bulk of new construction, and have been for a number of months. The entire coastal area is effectively bleak, he said.
The imbalance between multifamily and singly-family units comes as housing experts have repeatedly said that the future of development in the county is in urban infill and redevelopment. However, this is the first month since August in which builders pulled more multifamily than single-family units.
Because condominium financing is difficult to secure and county vacancy rates are low, new apartment construction is suddenly viable again, said Russ Valone, chief executive officer of MarketPointe Realty Advisors.
“We’re finally seeing new apartments come into the marketplace,” he said.
Citing SD-BIA research that an average of 140 different companies are involved in the construction of a single new house, Valone called housing construction a powerful job generator, and said increased building activity would strengthen the economic recovery.
Winckel said the last two months represent a positive trend line.
“I haven’t spoken to a single builder who thinks 2011 isn’t going to be a big improvement from the last three years, but it still (won’t) make a dent in the county’s latent housing demand,” he said.
Source: SanDiegoDailyTranscript
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