New homebuilders have been underproducing for years, a problem now exacerbated by record homebuyer demand.
But new housing growth varies drastically across different parts of the country, and the D.C. metro is only one of four of the 25 largest metros where housing growth has kept up job growth as one measure of demand. Houston, Dallas and Charlotte are the other three.
ApartmentList looked at a decades’ worth of data from the U.S. Census Bureau, showing nationally 9 million new housing units have been built since 2010, growing the number of homes by 6.9%.
To determine whether the supply of new housing units is enough to satisfy demand, ApartmentList compared the number of new homes being added to each metro’s job growth. The D.C. metro does pretty well by that metric.
“In Washington, D.C., the reason that we say that the metro is doing a descent job is because of the ratio of new jobs to new homes. In the past decade, for every 1.72 new jobs that were added, one new home was built, so that’s pretty good,” said Rob Warnock, senior research associate at ApartmentList.
A healthy market should add a new housing unit for every one to two new jobs as local economies grow, ApartmentList said. Housing units include single-family homes, condominiums and rental properties.
From 2010 to 2020, the D.C. metro added 181,000 new housing units, increasing the housing stock by 8%. Over that same period, the D.C. region added 310,000 new jobs — an increase of 11%.
The fastest growth for new housing units in the D.C. metro in the last decade by county has been Loudoun County, Virginia.
“And it’s not a small county, so it’s not a small denominator. In Loudoun County, we have seen 30% growth this decade in the number of homes, with over 33,000 new homes built in Loudoun County just since 2010,” Warnock said.
Metros that have built the least new housing relative to jobs added are mostly in two distinct groups; expensive, housing-constrained coastal markets and Rust Belt metros.
New York City, Los Angeles, Miami, Riverside, Chicago, San Francisco and Detroit rank at the bottom of the 25 largest metros for slowest housing growth compared to job growth in the past decade.
ApartmentList’s entire report on new housing growth and job growth, and its analysis, is posted online.