Scott Van Voorhis writes in this week’s Banker & Tradesman that the Bay State won’t see the steep home price drops that other parts of the country have seen, including communities in California.
He points out that one of the reasons home prices are a bit more resilient here is that there hasn’t been the type of overbuilding that took place in places like Phoenix and Las Vegas. The numbers from the U.S. Census bureau show that to be the case:
The number of housing permits issued in Massachusetts fell 61 percent from 2005 to 2008. More than 23,800 permits were issued in 2005. By 2008, the number of permits dropped to 9,241.
By comparison, Arizona — which has a similar-sized population as Massachusetts — issued almost four times as many permits in 2005 (91,436). Three years later, the number sank to 25,232 – still much higher than the permitting activity in Massachusetts.
Tennessee, another state that has about the same population as the Bay State, also saw more building. In 2005, more than 46,000 housing permits were issued – almost double Massachusetts’ level. By 2008, there were 21,699 permits – 57 percent more than Massachusetts.
Source: Banker & Tradesman
File this under: No overbuilding just a few holes in the ground.