Take some time to investigate. How does an increase in sales of existing homes help to alleviate a persistent gap in housing unit construction?
hcd.ca.gov
High Demand/Low Supply
California continues to experience very high rates of population growth and further tightening of its housing markets. Even encompassing the recession of the early 1990s, California’s population grew by an average approximating 450,000 people annually and is projected to gain around 600,000 annually over the next decade.1 As of January 1, 2005, California’s population was 36,810,358 which increased by 539,267 people in 2004.2 The population increased 1.5% from the calendar year 2004, which was lower than the 1.8% growth between 2003 and 2004.3 As in 2001, the United States became home to more than one million immigrants in 2002. California was home to the largest number (291,191 or 27.4 percent) of the 2002 immigrants.4
Housing production has not kept pace with the State’s housing needs, particularly in the coastal metropolitan areas and housing need has worsened, especially for renter households and low income owner households throughout the State. During the 1980s, 2.1 million units were built whereas the 1990s saw only 1.1 million units built. While the average annual need is projected at approximately 220,000 housing units, construction has lagged substantively below the need. Since 1999, less than 170,000 residential new construction permits have been issued each year. During 2004, 212,960 new homes and apartments were built, representing the highest production since 1989.5
The greatest production gap is in multifamily housing. Multifamily development only accounted for approximately a quarter of all new units during the 1990s, a drop of nearly 70 percent from the levels of the 1980s. Since 2000, the number of multifamily units has increased slightly, totaling approximately 28 percent of all new units constructed.6 |
