California housing statistics decrease amidst national increases

What puts January 2020 activity in perspective is how California compares to housing starts reported for the entire nation


TheĀ CIRB (Construction Industry Research Board) Report released California building permit statistics for January 2020, revealing month-to-month decreases across all categories for new housing units issued compared to December 2019. Year-to-date total and multifamily units issued also trended down in January, while single-family homes increased by 26% from January 2019.

Year-to-date residential building activity in California has been declining for the past several months, so it’s not surprising that this trend has continued in the first month of the New Year; however, what puts January 2020 activity in perspective is how California compares to housing starts reported for the entire nation. (Read about the difference between housing starts and permits issued here.)

In a blog post recently published by NAHB (National Association of Home Builders), citing housing starts from the US Census Bureau and HUD, January 2020 “total starts are 21.4 percent above the annual pace of 1.29 million units” compared to January 2019. Meanwhile in California, total housing units are down 11% in January 2020 from 2019.

The most striking is the multifamily category, where in the US, “On a year-over-year basis, multifamily unit production is up 71.4 percent,” but in California, multifamily activity in January decreased by 34%.

Take a closer look at January 2020 permit activity in California here: <<Download the Free Infographic>>

The question remains: Why is our state, the fifth largest economy in the world (source: Forbes), lacking in new housing permits, while the US as a whole is showing improvement?

Contributing factors of this decline can range from seasonality (less construction activity in colder months) to legislative and regulatory impacts on statewide building practices, and numerous other reasons in between.

Can 2020 permit activity make a comeback from 2019?

Subscribe to the CIRB Report to find out. Email chf-cirb@mychf.org to get on the distribution list.