What’s measured This measure focuses on the number of housing units for which building permits were issued by counties within the Charlotte region from 2000 through 2006, based on data from the U.S. Census Bureau. The indicator is expressed as housing units per 1,000 persons. Data on types of residential permits and construction costs are included as well. Why it’s measured Looking at annual residential building permits can offer insight into the region’s housing supply. A high number of permits for newly constructed housing units suggests an expansion of the housing supply. Provided that the increase in supply keeps up with the increase in demand (caused by population growth and other factors), housing prices should remain fairly stable. If supply outpaces demand, prices should fall. If supply does not keep up with demand, prices should rise. Indicator results In 2006, the average county number of residential building permits issued was 9.99 permits per 1,000 residents. This was up from 9.9 permits per 1,000 in 2000, but down from a high of 10.3 permits per 1,000 residents in 2005. The fewest permits were issued in 2003, when the counties averaged 9.0 permits per 1,000 residents. From 2000 to 2006, the average cost of construction increased every year. In 2006, the average cost per unit was $165,201.79. Of residential permits issued in the region in 2006, 17.8 percent of the units were multi-family. This was sharply lower than in 2000, when 29.1 percent of the permits were for multi-family. Among the counties in 2006, Union issued permits for the most units at 22.6 per 1,000 residents. Anson issued permits for the fewest units, 2.1 per 1,000 residents. Lincoln had the highest cost per unit at $346,563.40. This figure was up dramatically from $114,581.04 in 2005. Union had the second-highest cost per unit ($202,123.96), and Chester had the lowest cost per unit ($84,100.85). Evaluation The number of permits issued to build residential units has been rising in the region, suggesting an increase in the region’s supply of housing. Single-family residential units account for a large proportion of the permits issued, and their share increased from 2000 through 2006 (although there was a slight decrease from 2005 to 2006). Costs also have increased steadily, for both single-family and multi-family units. This trend may reflect price increases for construction materials, and could result in housing affordability issues in the region. As a part of the regional economy, development and construction of housing seemed to be performing well through 2006, even as other real estate markets across the country began to decline. This industry provides an important source of income, but the region’s rapid growth could put strains on public and natural resources. Connections The number of annual residential building permits has important implications for the region’s economy. It has obvious connections to the availability of housing for residents. But new construction is itself a significant contributor to the economy in the form of jobs and investment opportunities. Beyond the economy, residential building permits are connected to the adequacy of public services and natural resources. High numbers of permits may strain schools, water and sewer networks and police and fire coverage. Moreover, increased building leads to a loss of open space and natural areas.
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