NYC Must Produce 20,000 New Housing Units a Year to Keep Up With Exploding Population
The 2015 census puts New York City’s population at a record high of 8.6 million. This is a 375,000-person increase from 2010, the biggest spike since the 1920s. The rise is attributed to the nearly 250,000 jobs that were created in 2014 and 2015, the $7.3 billion in venture capital present in the city in 2015 (the second-highest level ever), and record-breaking tourism that’s created a boom in the hospitality industry. And of course, with more people comes the need for more places to put them, and Commercial Observer estimates that the city “needs to produce at least 20,000 new housing units each year just to keep pace with demand and population growth.”
When looking at multifamily real estate in New York (the main housing stock, naturally), dollar volume rose 110 percent to $22.5 billion in 2015, compared with 2014’s $10.7 billion. But new units aren’t being produced fast enough, especially when it comes to affordable housing and rentals, a problem since the majority of New Yorkers don’t own. According to CO, “The New York Building Congress reported that only 36,714 permits for residential units were issued between 2010 and 2013, an average of 9,178 a year, and while building permits rose to 20,574 units in 2014 and 52,618 units in 2015, the supply still hasn’t caught up with demand, particularly in the affordable housing arena.” And as population continues to increase, along with the expiration of the 421a tax program, current multifamily properties are likely to be in demand from investors.
[Via CO]
RELATED:
