Multi-Family Leads Recent Housing Uptick in California

With stronger state mandates kicking in, California housing permits rose sharply in September. But as one construction industry commentator noted, an uptick isn't a trend.

1 minute read

November 26, 2019, 10:00 AM PST

By Philip Rojc @PhilipRojc


California

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"After months of limited and in some cases nonexistent growth, California saw a sharp rise in the number of building permits for new homes in September," Emily DeRuy writes. Under greater pressure from Governor Gavin Newsom's administration, regional planning agencies may be giving in to more growth.

However, while the 142,000 units authorized in September mark a pointed increase over August's 116,000, "it's just a fraction of what will be needed to meet Newsom's goal." Earlier this fall, Newsom and his allies in Sacramento called for 3.5 million new units of housing to be built across California by 2025.

Notably, permits for multi-family units are leading that charge with a full 47 percent increase in September. "Permits for single-family units actually fell by around 2 percent in September," DeRuy writes. Still, construction industry commentators are skeptical this uptick in multi-family will last. "High construction and land costs, along with city fees and regulations, make getting developments off the ground difficult," one noted.

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