Construction of housing here is booming, but it’s having a hard time keeping up with job growth — hence, rising prices. Also, one small town in Spain is way ahead of its peers in e-commerce.
We know about Seattle’s construction boom — but how does the region’s growing supply of housing stack up against other big hubs?
New census data show the Seattle metropolitan area doled out permits for 25,516 new housing units in 2016, the seventh-most in the country. That’s not bad at all considering we’re the 15th-biggest metro area in the nation. All the places that built more housing than Seattle last year are far bigger than us.
The Dallas area led the country with twice as many new housing units as Seattle last year (although it is twice our size), followed by Houston, New York, Atlanta, Los Angeles and Phoenix.
Seattle also ranks near the top for building apartments. About 63 percent of the housing units that were built in the area last year went into multifamily buildings — the seventh-highest rate in the country among big regions.
Most Read Business Stories
- Peek inside $75M family compound for sale on San Juan Island VIEW
- How a Seattle architect helped make timber towers legal in the U.S.
- He wanted to unclog cities. Now he’s ‘Public Enemy No. 1’
- Rally faults Meta's treatment of nontech workers during cutbacks
- Selling a Seattle-area home this spring? Here's what you need to know
Most of the places that built more housing than Seattle last year did so largely by adding tons of new single-family houses across wide swaths of land, which isn’t an option in urban places like Seattle that have run out of room to build new tract communities.
Only New York, Dallas and Los Angeles built more multifamily units than Seattle last year (the vast majority being apartments).
The city of Seattle is expecting a record number of apartments to open this year. The real-estate firm Marcus & Millichap projects Greater Seattle will be the fifth-busiest market in the country next year for apartment construction, dragged down partially by slower apartment growth in local suburbs.
Greater Seattle did have thousands of new single-family homes built last year, but most were outside the city of Seattle. The metro area covered in the report spans from Tacoma to Snohomish County.
Obviously, the new housing hasn’t helped make rents or home prices cheaper — far from it, as housing prices continue to soar at among the fastest rates in the country.
A big reason is that all that new housing isn’t keeping up with all those new jobs driving demand for homes.
The website employmarket.com crunched the housing-construction data along with employment numbers from last year and found Greater Seattle last year was actually slightly below average for new housing construction when adjusted for job growth.
The Seattle area was tied for second in employment growth last year, behind Orlando but even with Salt Lake City and San Jose. Seattle has also been among the fastest-growing cities in the nation for population for several years now.
With demand and supply both growing rapidly, demand is winning. Apartment vacancy rates and the number of homes for sale are both historically low, driving up prices.
The Marcus & Millichap report forecasts Seattle to be tied with Salt Lake City for third in employment growth in 2017, behind Orlando and Fort Lauderdale.
So how does the current housing-construction surge compare to the region’s past? It depends on what kind of housing.
Overall, the number of housing units being built now in the Puget Sound region is roughly equal to the housing that went up during the boom in the middle of last decade.
But construction of single-family homes from Tacoma to Snohomish County is way down — to nearly half the levels seen during the few years leading up the recession last decade, and well below the number of new houses built in the late ’90s.
Apartment construction, on the other hand, is way up: The number of multifamily units permitted last year was nearly double the average from the previous two decades. Experts are hoping this will finally slow down rent growth in 2017.
Overall housing construction has been rising for seven straight years, and the number of new units has tripled since the depths of the recession.
Here’s one last eye-popping number from the census report: $5.3 billion. That’s the value of all the housing built in the Seattle region last year, up from $1.4 billion during the recession.
— Mike Rosenberg: email@example.com
Spanish villagers are Amazon fans
Añora, an Andalusian village of 1,500 founded in the 14th century, is remote and aging, like many other small towns in rural Spain. But it does have one interesting distinction: an unbridled addiction to e-commerce.
Amazon says that among Spanish cities with less than 10,000 inhabitants, Añora makes the most purchases per capita on the e-commerce giant’s site.
Some 84 percent of the village’s residents bought something from Amazon in 2015, and the company ships about 15 parcels per week there.
Noriegos, as the villagers are known, do 60 percent more internet shopping than average for towns of similar size, Amazon says.
What makes this cattle-ranching town so enamored with one-click shopping? José Reyes, the man who runs the local government-provided internet center, had various explanations.
The most obvious one is that there’s little to buy at home, and the nearest big city, Córdoba, is 50 miles away.
“You have to spend an hour in the car, and even going to Córdoba, you risk not finding” what you’re looking for, the 40-year-old computer engineer said in a telephone interview.
Then there’s the network effect, which is amplified in a small village. According to Reyes, that led internet shopping to catch on almost overnight around 2011 or 2012.
“If you buy something and it works out, the next day everybody knows about it,” Reyes said.
Reyes himself is an avid online buyer and a member of Amazon’s “Premium” service (the loyalty program known as Prime in the U.S.), which offers shipping privileges. Reyes and his wife placed 65 orders from Amazon in the past three months, with purchases including exotic Peruvian beers.
Across the entire village, the best-selling product is a small tube of clear glue that sells for about $8. The reason: La Fiesta de la Cruz, a local tradition celebrated in late April and early May, in which noriegos beautify crosses with elaborate decorations.
“They use a barbarous quantity of glue in those crosses,” Reyes said. “Maybe one day someone said they’d found the cheapest glue on Amazon, the word spread, and then everybody else did the same.”
Another popular product was a digital kitchen thermometer. The idea caught fire because a chef conducting a cuisine workshop in Añora told students he had found it on Amazon, Reyes said.
The phenomenon shows one of the most interesting aspects of e-commerce: how it gives remote locales access to a bounty of potential merchandise bigger than any Parisian boulevard or American shopping mall.
“E-commerce is rapidly accelerating in Spain, and customers living in rural areas are definitively fueling this growth,” said François Nuyts, vice president for Amazon in Spain and Italy.
He added in a statement that, in addition to shopping, residents of these small communities can also use the Amazon platform to sell their stuff elsewhere.
Marisa Breton, a 43-year-old noriega, said she’s the second most active Amazon shopper in town (the foremost shopper, whose name is Rafa, doesn’t like speaking in public, Breton said). “Amazon should give me a prize,” the stay-at-home mom said in an interview.
Breton began shopping online a few years ago after her son, now 17 and a computer aficionado, showed her how. Reluctant about sharing financial data online, she opened a credit-card account exclusively for online shopping.
“What’s available in Añora, I try to purchase in Añora,” she said. But according to her, the village only has a bookstore, a stationery store, a pharmacy, a gift shop and a few supermarkets. However, she added, “There are lots of bars.”
Breton said she initially became such an assiduous Amazon shopper not because of stuff she bought for herself, but for people like her sister, who didn’t know how to access the Amazon site or didn’t want to put in their credit-card info.
That was in the early years, though. She says she has taught most people how to fend for themselves on Amazon’s rich online bazaar.
“Don’t give me fish; teach me how to fish,” Breton said. “People have to be independent and do their own things. One has to learn, especially in these times.”