Less than two months before the presidential election, (former) President Donald Trump and Vice President Kamala Harris are scrambling to meet demand for housing – with the industry (and developers) now drowning in red tape and zoning rules.
Last month, Wood Central revealed that the multifamily lending market (considered a sweet spot for mass timber construction) nosedived 49%, with more than 42% of the US $246.2 billion in loans written for Government-Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac in 2023 – and comes after Wood Central reported that developers are being crowded out of a market now flooded with an oversupply of lumber.
Now, new data obtained from the 2023 Survey of Construction (SOC)—part of the US Census Bureau—reveals that the average time to complete a multifamily building after authorisation (or from permit approval to construction) has spiked to more than 19.9 months—an increase of 0.1 months in 2023 and more than 2.4 months above 2022 levels.
“The average time to build multifamily homes varies with the number of units in the building,” according to the National Association of Home Buildings, “the more units, the more time required to build.”
Wood Central understands that the squeeze for approvals is especially prevalent in the West (20.9 months from permit-to-completion), followed by the Northeast (20.8 months) and the South (19.5 months). The Midwest has the shortest period, at just 17.3 months.
“In 2023, buildings with 20 or more units took the longest time, 22 months, to build after obtaining authorisation. Properties with 10 to 19 units require 21.5 months. However, 2-to-4-unit buildings took 18.7 months, longer than 5-to-9-unit buildings (16.9 months).”
Why social and affordable (multifamily) housing is shaping election
Last month, Diana Yentel, the President and CEO of the National Low Income Housing Coalition, said that Trump and Harris are now targeting low-income (rather than middle-class) housing to secure swing votes.
“Before 2020, when presidential candidates talked about housing, it was always about middle-class home ownership.” Now, both parties are prioritising the issue “much more than they have before,” including “the needs of people with the lowest incomes,” said Ms Yentel, in part because of “the severity itself” of the crisis.
“What we want from housing is for it to both be affordable and for it to be a way to generate wealth,” according to Chen Zhao, economics lead at the real estate company Redfin, who spoke to NBC News. “The problem is that you can’t generate wealth without prices going up, and if prices are going up, they’re no longer affordable.”
“Supply is the No. 1 thing we must be worried about,” said Zhao. “The main thing we need to do is to build more supply, and one of the main constraints — perhaps the main constraint to building more supply — often is local zoning rules and building regulations.”
- To learn more about the housing policies tabled by (former) President Trump and Vice President Harris, and the role of new timber systems in easing the squeeze for multifamily construction, click on Wood Central’s special feature.
