Earlier today, the U.S. Census Bureau released population estimates for 2014 and revised numbers for 2013, showing strong growth in New York City, and highlighting the continuing chronic housing deficit.
The five boroughs are near a population of 8.5 million, with 8,491,079 people counted within the city as of July 1, 2014 (all numbers are as of July 1 of each year). This represents a gain of 299,226 people since 2010, when the Census Bureau registered a citywide population of 8,191,853 (though it should be remembered that the decennial count was disputed by the city, which thought that the Census Bureau undercounted neighborhoods with growing immigration population and lots of new construction).
The total gain of nearly 300,000 residents since 2010 – around 75,000 a year – hasn’t even come close to being matched by new housing. The Department of Buildings has only approved permits for around 50,000 new dwelling units from July 2010 through June 2014 (which doesn’t take into account demolitions), enough to house just 120,000 people at a rate of 2.4 inhabitants per unit, which is the average occupancy of a house or apartment in the city. (And that’s assuming all of the units get built. Historically, around one-third of all units approved do not materialize.)
In fact, even when the market cycle is at its peak, the city has never built enough housing to satisfy a population that’s growing by 75,000 people per year. The city has at no point handed out certificates of occupancy for more than 21,493 new homes per year, according to the Furman Center, translating into room for not many more than 50,000 new residents (again, not taking into account razed structures).
And even if the de Blasio administration meets its goal of building 24,000 new homes a year on average, that still won’t be enough for 75,000 newcomers each year – 24,000 new units only translates to around 58,000 new residents.
And if that weren’t enough bad news, population growth in an in-demand city like New York with a low vacancy rate lags behind actual demand growth, since population growth is ultimately constrained by growth in the housing stock. There is, after all, a limit to how tightly would-be newcomers are willing to pack into overcrowded houses and apartments before they drop plans to move to the city altogether.
Demand is an impossible variable to quantify, but the growth in demand surely exceeds population growth. And with supply falling well short of even the growth in residents, there’s absolutely no hope that rents will stabilize any time soon.
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