Building permits drop about 14% in 2012

By Franny White, Herald staff writerJanuary 7, 2013 

The number of building permits for new single family homes in the area declined by about 14 percent in 2012 compared with the previous year, according to the Home Builders Association of Tri-Cities.

Compared with 1,332 in 2011, 1,144 permits were issued in 2012,

The biggest drop was in Pasco, where permits dropped about 35 percent -- a decline of 170 homes. That was a hit for the whole home building market, said Jeff Losey, the association's executive director.

"They've been such a driver for the new permits pulled in the Tri-Cities," Losey said.

One possible reason the Pasco activity dropped is a new school impact fee -- opposed by builders -- imposed by the city, Losey said.

Rick White, Pasco's community and economic development director, disagreed. He wasn't surprised to see a decline because the last couple of years have been strong, he said. Permits for 2012 are likely to end up around 315 to 319.

White anticipates more subdivision activity in Pasco this year, he said. Developers have indicated they will need to look at additional lots for homes.

Richland saw the same number of new homes permitted in 2012 as the previous year -- 265, said Rick Simon, Richland's development services manager. Issued permits for new homes have ranged between 217 and 332 since 2007.

Most of the new homes in Richland have been permitted south of the Yakima River, Simon said.

Kennewick's 268 permitted homes were down by about 20 in 2012 compared with the previous year, according to Evelyn Lusignan, Kennewick's customer service manager, who said the outlook for future permitting activity is still great.

"We continue to receive a lot of interest from developers," she said.

Southridge is the most active development area in Kennewick, with about 900 lots receiving preliminary plat approval, Lusignan said.

Activity in West Richland was up 18 percent from the previous year, with 138 homes permitted in 2012.

Kennewick, Pasco and Richland all saw continued multifamily development activity, although it also was down from recent years.

Richland permitted 176 new apartment units last year, Simon said. There were 342 units permitted in 2011 and 155 permitted in 2010, after two years of no multi-family building.

Pasco and Kennewick each permitted 150 units in 2012, according to city data.

That was down from the 232 units Kennewick permitted in 2011.

Losey of the Home Builders Association expects the number of home permits to hold steady in 2013. No one in the industry is really thriving, he said.

The permits have been spread out among more builders, Losey said. Companies from other areas have come to the Tri-Cities market because of the slowdown in their own areas, but those companies are still employing local workers, he added.

The national economy will determine how fast the local construction market bounces back, Losey said. Some markets in other areas of the country that were hit the hardest are starting to improve.

"The building industry is a reactionary industry," he said. "We need low unemployment and we need jobs."

-- Kristi Pihl: 582-1512; kpihl@tricityherald.com

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