GHP: Houston Jan. 2016 building permits down 31%

​​HOUSTON – City of Houston building permits totaled $400.1 million in January 2016, down 31 percent from $580.2 million in January 2015, according to the latest data released by the City’s Department of Public Works & Engineering Planning & Development Services.

The 12-month total fell from $8.7 billion in the 12 months ending January 2015 to $8 billion in the 12 months ending January 2016, a 7.3 percent decline.

Both commercial and residential sectors experienced over-the-year declines in permit activity. 

Non-residential permits dropped by a third, from $389.1 million in January 2015 to $259.4 million in January 2016.

Residential permits declined by a quarter, from $191 million to $140.7 million. Over the same period, permits for single-family homes decreased 35.8 percent from $126.2 million to $81.0 million. 

Permits for multifamily buildings declined 93.5 percent from $45.4 million to $3.0 million. The slowdown in multifamily construction is expected. 

Apartment Data Services reports 102 properties (29,062 units) are under construction.

As a rule of thumb, one apartment unit is needed for every five new jobs created in the region. Assuming the Partnership forecast of 21,900 job growth in 2016, Houston would only require 4,380 more apartment units in 2016. 

Many Class A properties have already begun offering concessions to their tenants and cutting rental rates. According to Apartment Data Services, Class A rental rates have fallen from its peak of $1.54 per sf per month in August 2015 to $1.51 in December 2015.