Trends favor apartments
Andrew Edwards, Staff Writer
Created: 01/25/2012 03:20:18 PM PST
Residential developers will remember the past year as the third-slowest in California history – and the slowest ever in terms of permits for new single-family homes.
Golden State developers are finding a better market for apartments and other multi-family living options than new homes.
And among those who are in the market for new homes, bigger is not necessarily better.
“I think everything is shifting to smaller lot sizes and smaller homes. Everything is driven by affordability,” said Jeff Simonetti, vice president of government affairs for the Baldy View chapter of the Building Industry Association.
The new data is from the California Building Industry Association. Its tally of building permits issued for new houses, apartments, condos and townhomes, the trade group reports the 47,015 permits granted last year amounted to the third-smallest on record.
The California BIA’s numbers go back to 1954.
The years 2010 and 2009 are the only years when California governments issued fewer permits.
The nadir came in 2009, when permitting authorities approved 36,421 new residential units of all types.
But when permits for single-family homes are considered in isolation from apartments and other multi-family projects, last year was the slowest ever for single-family homes.
California developers received permission to build a mere 21,420 houses last year, down 16 percent from 2010.
By contrast, multifamily permits jumped 33 percent to 25,595 new permits.
“We continue to see strong demand for rental communities, and many people choose to rent for lifestyle reasons as well as for mobility,” said Randall Lewis, executive vice president of the Upland-based Lewis Group of Cos.
Lewis Group develops land for merchant builders and also builds apartment complexes.
For now, Lewis is more optimistic on the apartment side of its residential business. He is not expecting a significant uptick in new housing sales until late this year.
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