New data from the Census Bureau today on housing permits (PDF) confirms that with rents high homebuilding is making a comeback—especially multi-family structures that must be intended specifically for the rental market. Overall building permits were up 34.3 percent in February 2012 from where they were in February 2011. That includes a 73.3 percent jump in the number of units authorized in structures with 2-4 units (admittedly a small part of the overall marketplace) and a 59.9 percent leap in units authorized in structures with 5 units or more. Since this is February data, I’m still tagging this as part of Recovery Winter despite the balmy March weather outside.
The Rent Is Too Damn High is not a book about short-term housing or economic issues, but the TRITDH analysis should remind us that this apartment-building surge is starting even though there are huge barriers to building in the places where demand is objectively highest. A lot could be done to juice short-term growth by acting expeditiously on an agenda of legalizing city-building.