ANNUAL SINGLE-FAMILYPERMITS: PEAK, TROUGH, AND RECOVERY
PRE-RECESSION PEAK
POST-RECESSION TROUGH
PEAK-TO-TROUGH DECLINE
TROUGH-TO-RECOVER INCREASE
AREA
RECOVERY
CYCLE PERIOD
30,303
7,514
-75%
34,685
362%
1983-2002
Houston, TX
90,047
30,746
-66%
82,729
169%
1989-2005
Southern California
60,926
7,212
-88%
17,584
144%
2005-Current
Phoenix, AZ
1,681,986
418,498
-75%
707,400
69%
2005-Current
United States
Source :: US Census Bureau; John Burns Real Estate Consulting, LLC (Pub: May-16)
80,000
70,000
60,000
50,000
40,000
30,000
20.000
10,000
0
mand for housing in Phoenix. Rolling year-over-year employ- ment growth has been in the 3 percent to 4 percent range for the past year, translating into nearly 70,000 added jobs over the past 12 months. Total employment of 1.97 million finally has surpassed the previous peak of 1.95 million reached in Decem- ber 2007. As total employment continues to reach new highs, we expect the Phoenix economy to continue to thrive, which will provide supporting tailwinds for its new-home market. •
Phoenix) declined 75 percent. Despite Phoenix’s new home market having performed below expectations in 2014, the metro area’s single-family permits recovered faster than the nation, rising 144 percent from the trough, compared to 69 percent for the nation as a whole. The current U.S. housing cycle is mirroring that of the cycles experienced in the recessions in Houston in the 1980s and Southern California in the 1990s: four years of falling sin- gle-family permit activity, three years of relatively flat issuance and then an increase in permits. Phoenix followed the same trend for the first seven years but has fared better than the overall national trend over the past four years. We forecast steady permit growth in Phoenix through 2019. Since mid-2015, solid jobs growth has driven the strong de-
Ken Perlman is principal and Sean Fergus is manager at John Burns Con- sulting. If you are interested inmore details about our Phoenix forecasts and reports, please feel free to reach out to Perlman at kperlman@reales- tateconsulting.com or Fergus at sfergus@realestateconsulting.com.
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