Curry County and the Housing CrisisApril 20, 2017 Prospective homebuyers in Curry County report finding limited inventory, especially for homes within the buyer’s budget range. State and national news also tell of limited inventory as well as bidding wars. What is behind the headlines and conversations when it comes to housing availability? Pivotal to the matter is the shrinkage in the number of new residential building permits in recent years and the associated decline in construction jobs. The U.S. Census Bureau’s Residential Construction Branch studies new, privately owned residential construction by tracking the number and type of building permits issued. Most telling in Curry County is the absence of permits for multi-family homes, particularly those not restricted to senior citizens. Not only are single-family dwellings in short supply, but rental options are also extremely limited.
Housing Shortages Building over Time
The relationship between population growth and housing demand is apparent in the graph highlighting both factors. Curry County’s population climbed steadily during the first fifty years of the 20th century, and construction expanded to meet increased demand for housing.
During the 1950s, Curry’s population tripled; housing construction responded in kind. However, impacts from economic downturns (1957-1958, 1960-1961, and 1973-1975) took their toll. The rapid population growth slowed, subsequently dipping nearly 7 percent, from 1960 to 1970. Housing development continued, most likely a result of the time needed to complete on-going construction projects. The 1980s saw retirement in-migration and employment opportunities at the Pelican Bay State Prison south of the state line in California. This influx ushered in sustained population growth that continues today. Housing kept pace throughout the 1990s but slowed dramatically during the recessionary periods of 2001 and 2007 to 2009. The effects of the Great Recession continue to exact a heavy toll on the construction industry.
Nearly half of the local housing inventory was built prior to 1980. Continued population growth and reduced construction, compounded by an aging inventory, which presents maintenance and replacement needs, keeps today’s homebuyers and renters scrambling for options.
Type of Building Permit Has Long-Term Impacts
Since 2001, three out of every four permits issued for new privately owned residential construction in Curry County have been for single-unit dwellings. Apartments with five or more units account for 17 percent of the total, and smaller multi-family dwellings account for the rest. Building permits peaked in 2005 with permits for 185 total dwellings. Of these, 157 were for single-unit dwellings; 28 were for duplexes; there were no larger multi-family units permitted that year. The next few years saw a decline in building permits.
Corresponding to the depths of Curry County’s recession, building permits bottomed out in 2012 with only 19 issued, all for single-unit dwellings. Duplex permits have been issued in five of the last fifteen years; however, those were issued prior to 2006. The last time a permit was issued for a three to four unit structure was in 2009. Of particular interest, in 2009, there were permits for larger multi-family apartments (123 units). Subsequently, in 2010 local newspaper articles related construction activities of the 119-unit Sea View Senior Living Center in Harbor. During 2013 and 2014, Curry County also permitted 77 units within larger apartment complexes. Given Curry County’s older adult population, these complexes likely supply housing for retirees.
The reduction in overall housing permits not only laid the groundwork for limiting current and future housing options, there was also a contraction in employment opportunities for construction workers. Construction employment dipped following the economic downturn of 2001 but quickly rebounded, increasing to 660 by 2006 – corresponding to the development of the nationwide housing bubble. As the overall economy slowed in 2006, the number of housing permits issued dropped. The decline in construction employment soon followed. Recessionary losses in the construction industry hit bedrock in 2011 and again in 2014. Between 2006 and 2014, Curry County lost 52 percent of its construction employment. By 2015, this sector had barely started to recover.
Conclusion: Demand but No Supply
Declines in building permits issued since 2005, coupled with the decline in construction employment, have resulted in fewer residential structures built. With the exception of a spike in multi-family apartments permitted in 2009 and 2013, likely retiree-oriented, there has been an overwhelming issuance of single-unit housing permits. This focus particularly affects younger or less affluent home-seekers. Additionally, the majority of the county’s houses are at least 30 years old; nearly 50 percent were built prior to 1980. Aging inventory, especially in coastal climates, often presents added maintenance issues and increased costs. These inventory and structural issues, near-decimation of the construction workforce, and continued population increase significantly contribute to the housing shortages experienced in rural Curry County.