Prepare for a substantial slowdown in homebuilding growth in Austin and the state’s three other major metropolitan areas.
In a new forecast, the Texas Real Estate Research Center at Texas A&M University expects the percentage of growth in home construction to drop from double digits in 2020 and 2021 to single digits in 2022 and 2023 for Austin, San Antonio, Dallas-Fort Worth and the Houston metropolitan areas.
The research center says the number of single-family home building permits in the Austin area increased 19.4% from 2019 to 2020 and is expected to increase 20.8% this year from last year. But the center predicts that year-over-year growth in Austin’s permits will drop to 5.2% in 2022 and 4.8% in 2023.
Of the four subways in Texas, San Antonio is expected to experience the largest decline in growth in new building permits for single-family homes, according to forecasts.
Here’s what the year-over-year numbers look like for the state’s other three major metros in terms of the growth in building permits issued for single-family homes:
- 19.9% ââin 2020
- 27.9% in 2021
- 5 percent in 2022
- 5.3% in 2023
- 25.2 percent in 2020
- 22.5% in 2021
- 5.3% in 2022
- 5.7% in 2023
- 22.2 percent in 2020
- 12.8% in 2021
- 6.3% in 2022
- 6.5% in 2023
“In 2022, new home construction is expected to increase, but at a slower pace than the previous two years as the housing market stabilizes,” the research center said in an August press release. “The housing market will shift towards a more sustainable long-term path as the pandemic housing market frenzy wears off.”
The outlook for Texas aligns somewhat with current national trends. Nationwide, the number of building permits for single-family homes fell 6.3% from May to June, according to the US Census Bureau and the US Department of Housing and Urban Development. This follows a 1.6% drop from April to May.
“The permits are now lagging behind [construction] begins, suggesting that home construction will slow down in the coming months, âthe Reuters news service said.