New home single-family construction permits in Texas reached a 10-year high in March 2017, with 10,481 permits issued, an 11.5 percent increase, according to Dr. Luis Torres, a research economist with the Real Estate Center at Texas A&M University. Austin’s 1,547 new home permits were also the most the capital city has seen in a decade.
“Texas led the nation in total permits issued and ranked fifth in permits per capita,” said Torres. “Construction permits increased significantly in the Texas Urban Triangle.”
Houston was number one in the nation for new home construction permits, with 3,543 permits issued, and Dallas was number two in the nation with 2,405 permits issued. Nearby Fort Worth experienced a 45.4 percent increase since January 2017 in new home permits, with 863 new permits issued in March 2017.
“After lagging in February, permits in Austin and San Antonio surged as well,” said Torres. “San Antonio’s 705 new home permits was a 27.2 percent increase.”
Actual housing starts, which lag new construction permits, increased 26.7 percent quarter over quarter in Texas, the “strongest showing in more than a decade.” In Dallas, quarterly starts were up 4.6 percent. In Houston, quarterly starts were up 5.3 percent. And in San Antonio, quarterly starts were up 5.8 percent. “Housing starts fell in Austin,” said Torres, “but should gain momentum from positive permit numbers.”
Even with this new construction, however, upward pressure on prices continues. “Lower-priced housing is in short supply,” said Torres. He said homes priced at $200k or less have only a 3.1-month supply of homes, compared to about a six-month supply in a balanced market. “Increasing land and labor prices have forced homebuilders to concentrate on the higher-end market,” he said.
The Texas new construction housing permit boom is highlighted in the Real Estate Center at Texas A&M University’s latest issue of Texas Housing Insight.