Residential Construction is Lagging in New Jersey This Year
Residential construction continues to drag in New Jersey. Construction permits in September were lower than in August. And permitting activity in Jersey is down compared to last year.
Economic Analyst Patrick O'Keefe of Cohn/Resnick in Roseland says September came in with a fairly large drop in the number of units that were approved, down by about one-fifth from the prior month. But he cautions against reading too much into the month-to-month numbers, "because what we have seen over the last 15 months is that every other month has been up, and the subsequent months down."
Commenting on housing construction permitting so far this year in the state, O'Keefe says for the nine months up and through September, New Jersey is running behind where it was at the same point last year. "We are down 12.6 percent from where we were through September of 2015."
O'Keefe says the type of housing construction that is dominating building activity in New Jersey is apartments and condos, with two thirds of all new housing unit approvals being in multi-family buildings.
He also says that the big swings that we have seen, month-to-month, have been in that multi-family category.
Single-family home construction continues to lag far behind because of high costs for new homes.
O'Keefe says Jersey builders right now seem to be struggling to keep their people engaged and employed.
"It is beginning to be a bit of an uphill battle," he says.
He says a lot of that has to do with the way in which the approval process, when it comes to multi-family projects, has slowed down because the applications are more complicated.
"The easy-to-develop lands are pretty much under construction. And so we are seeing some lag, simply because the applications are more difficult to process."