Manpower shortages in some municipal building and codes offices are slowing the permitting process for new residential construction, keeping both builders and their hopeful clients waiting months to start construction.
The Wall Street Journal reports some builders are pushed to the brink of bankruptcy as permitting delays essentially prevent them from working. Denver builder Jared Phifer told the newspaper it can take as long as eight months to get a building permit, and by then the prices he quoted customers are no longer accurate.
“We’ve had to put a halt on so many projects that I’m in the process of getting a loan for $150,000 to cover all of our expenses,” he said.
The National Association of Home Builders says the median delay for developers of single-family homes was seven months in 2015 compared with four months in 2011.
The newspaper said city governments cut employees during the recession and have been reluctant to hire them back. At the same time, the demand for housing is going up as both rents and home prices climb. Municipal officials could use more help, but they are wary of getting stuck with too many employees should another recession slow the flood of permit applications.
In Nashville, Tenn., the Department of Codes and Building Safety has about 100 employees and will process permits for nearly $3.6 billion in construction this fiscal year, up from a record $2.4 billion last year, according to the WSJ. But there are still delays–one developer said it took six months to get city permits for a 247-unit apartment project.
“We are always conscious of not overstaffing,” said Terry Cobb, the director of Nashville’s building department. “During recession years we tend to lose positions. Then to have this immediate turnaround-we’ve been chasing it.”
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Overworked municipal building and codes offices have more permit applications than they can handle, increasing the wait for permit approval in some areas to six or more months.
