In comparison to the home building trends that followed the housing collapse, you could certainly say that Portland is in the midst of a building bonanza. However, despite the welcomed uptick in construction, we still aren’t keeping up with a staggering growth in local population. This means that our current competitive market is likely going to stay that way.
Experts say that unlike other major metropolitan areas, builders in Portland and its suburbs did not put up a huge amount of homes during the bubble years. Since the mid-90s we’ve only built one new housing unit for every 2+ new residents. We’ve had a notable increase in population as Oregon has been a top destination for out-of-state movers for many years in a row. (What can we say? It’s a phenomenal place to live.)
When the bubble burst, construction came to a screeching halt. There was little demand for new homes and not much financing available for building new apartments. But, we’re bouncing back, especially where apartments are concerned, which makes up a majority share of new housing construction. Multi-family complexes are popping up at a breakneck pace.
However, it’s still too little too late in terms of inventory. Considering those years where builders were twiddling their thumbs, we’re way behind despite the rush of new homes and apartments that have been built and are currently in the pipeline.
Essentially, we’re going to need 12,000 new units every year just to keep up, and according to reports, last year we added about 11,700.
In the meantime, we’re dealing with a heated seller’s market where buyers and renters are battling not only with each other, but because of the competition, with rising prices as well.
There’s still a question of what type of housing is needed most, and where. We may be reaching a saturation point for apartments, given the number of multi-family facilities already built and under construction. New home development in the suburbs is only beginning to recover. Builders aren’t feeling the push to increase production as demand for new homes hasn’t been significant just yet.
Experts say that as the economy improves, those who are currently renting will regain confidence in the market and hopefully step out to buy. But, we can’t just assume that history will repeat itself.
The shortage is most severe in Portland’s close-in urban neighborhoods where more people want to live— young, highly-educated folks in particular. And if we’re talking about young adults, it bears mentioning that while many more are finally moving out of their parents’ homes, they are choosing to live with roommates rather than on their own, slowing the formation of new households.
The only thing that we at Pacific West Roofing know for sure, is that most of those homes built in the last 20 years are in need of new roofs. When the time comes for repairs and replacements, we will be there. And as new housing units continue to sprout up, we’re always ready to contribute.
Contact us for a roof inspection or help with new construction today.
Portland Housing Pt 2: Construction and Demographics, Oregon Office of Economic Analysis