LANSING, Mich. (WZMQ) — Michigan is going against the national trend when it comes to new home construction. While single-family housing permits are down about 5 percent nationwide this year, permits in Michigan have risen nearly 4 percent.
According to U.S. Census data, 9,117 single-family housing permits were pulled in Michigan through July, compared to 8,791 during the same time last year.
Bob Filka, CEO of the Home Builders Association of Michigan, said the state’s numbers stand out.
“National numbers are down several percent year-to-date so far, and we’re up almost four percent statewide. In the U.P., we’re still up about one and a half percent year-to-date,” Filka said.
He credited the increase in part to Michigan’s long recovery after the housing crash nearly 15 years ago, when the state never fully regained its pace of new construction. That left a backlog of demand for new homes that still exists today.
“Over the last decade and a half we’ve really been building at the very high end of the market and not starter homes,” Filka said. “Today, local governments and the state are doing a better job aligning programs to help make the math work on more attainable housing.”
Still, Filka warned that the state remains far short of meeting its housing needs. He pointed to high interest rates, material costs, workforce shortages, and local zoning restrictions as ongoing barriers.
“There are so many different levels of action that are necessary, like getting local governments to be a partner for housing development,” he said. “Historically there’s been an adversarial relationship between builders and developers and local government, and if communities continue to deal with builders and developers in an adversarial way, they’re going to invest elsewhere.”
Filka also noted that expanding new home construction doesn’t just affect prospective buyers — it can help renters too.
“All housing production impacts rental housing and apartments,” he said. “The supply of housing in general has been constrained, so that puts pressure on rents.”
According to HBAM, Michigan is on pace to build about 16,000 single-family homes this year. Economists say a state of Michigan’s size should be building closer to 25,000 annually to keep up with demand and replace aging housing stock.
Despite the challenges, Filka called the upward trend encouraging and said it shows Michigan communities are beginning to recognize the importance of attracting new housing investment.
