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SCV construction stands alone

Despite a statewide trend of multifamily building, the SCV focuses on single-family homes

Posted: November 29, 2011 1:55 a.m.
Updated: November 29, 2011 1:55 a.m.

The crash of the housing market spurred more people to move into multifamily housing units and for developers to build them. But the trend in the Santa Clarita Valley remains single-family housing construction.

 

 

While an apartment complex and three smaller developments accounted for the bulk of building permits issued around L.A. County, the Santa Clarita Valley continues to buck the statewide trend, according to the numbers released by the Los Angeles/Ventura Chapter of the Building Industry Association of Southern California on Nov. 22.

According to data compiled by the Construction Industry Research Board, only 154 permits pulled in L.A. County during the month are for single-family homes, while 411 of the permits are for multifamily units.

While all county projects permitted are down 32 percent from September, the good news is the numbers are up 151 percent from October 2010.

During the first 10 months of 2011, multifamily permits — almost all for apartments — were up 60 percent from the same period a year ago to 6,179. Single-family permits were down by 3 percent to 1,924.

Still, the total housing units permitted this year is, by far, the most of any California metro area and marginally mirrors what economic analysts are projecting for the start-up of the housing market.

Analysts predicted activity will begin in the coastal regions while the inland areas will remain depressed.

However, in a slight twist, 8,103 total housing permits were pulled in L.A. County, while 4,442 housing starts were recorded in the Riverside-San Bernardino area.

Analysts also projected that once demand for new housing rises, the construction industry will be busy trying to meet that demand, as inventory is at record lows.

Still, what kind of housing will jump start the market remains the key question? Demand for multifamily or single-family housing seems to depend on the area.


Regional

While L.A. County is up in multifamily construction, permits for single-family housing still rule the Santa Clarita Valley, Ventura County and the cities of Lancaster and Palmdale.

On the single-family side, construction began on 12 new homes in the unincorporated areas around Santa Clarita, along with 19 in Lancaster and 10 in Palmdale. Ventura County recorded 15 permits for single-family housing and five for multifamily housing in October.

While permits in the SCV were up nearly 59 percent for the first 10 months of 2011 over 2010, permits were down nearly 45 percent in Lancaster and 30 percent in Palmdale during the same period.

Permits in the city of Santa Clarita were down nearly 52 percent in the first 10 months of 2011, down from 108 to 52 permits pulled.

Single-family construction has historically been more consistent than multifamily projects, said Holly Schroeder, CEO of the regional Building Industry Association chapter.

Schroeder points to the growth in multifamily building as further proof that local governments need to work more closely with homebuilders to allow projects to “pencil out.”

“While the state’s economy appears to be making small steps toward recovery, it’s unlikely that real recovery will get under way until homebuilders are able to ramp up construction to more normal levels,” Schroeder said. “Builders are more than willing to sit down with local officials around the region and find innovative ways to cut costs and make more projects financially feasible so that they can build more homes, put people to work and help the overall economy get moving again.”

However, the BIA notes that the number of permits issued is a good indication of the number of homes on which construction began. In California, building permits, which can run tens of thousands of dollars in development fees, are seldom pulled until construction is ready to begin.

The association is also advocating that local cities and areas reconsider developer fees, which vary greatly between areas, to jump-start home building. Some builders specifically target areas outside Santa Clarita to build, saying it’s too expensive in this economy to build locally.

 

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