Slow growth is working for county
The Douglas County Growth Management Ordinance enacted in 2007 stipulates a maximum number of allowable allocations for building permits each year. The number of actual building permits issued by the county since then has been significantly lower than allowed resulting in housing growth significantly below what is allowed by the ordinance. The county’s Planning Department historical record of building permits is as follows: From 2000 through 2006 a total of 4,240 building permits were issued, or about 606 per year. Then the Growth Management Ordinance became effective July 1, 2007.
From the recession years 2008 through 2012 there were only a total of 265 building permits issued or about 53 per year. This is a significant reduction from before the Growth Management Ordinance became effective. During these years the total allocation of building permits allowed was 1,682 so during this period only 16 percent of permit allocations were used.
From 2013 through 2018, economic conditions improved and 1,068 building permits were issued or about 178 per year. But during this time period, the allocation was 2,251 so only 47.5% of the building permit allocations were used. In 2019, as of the end September, 127 single family and six multi-family building permits have been issued, which projects to 177 permits for the year. But the allocation for 2019 is 402 so only 44% of the allowable building permits will be issued.
So the Growth Management Ordinance is working. Growth in new housing is lower than the 2% allowed. And this low level of building permits issued is despite a great economy the last seven years, record low unemployment and low interest rates. This lower than 2% housing growth won’t change regardless of the number of extra allocations available.
But why is that?
It’s because there is not high demand for more new housing. Builders will not build if they think demand is not there and projects are not profitable. Many factors are probably causing the low issuance of building permits. Finished, ready to build residential lots are scarce, and when you find one, the lot cost is $250,000 and up.
This eliminates any chance of affordable housing in our county. Douglas real estate prices are the highest in Northern Nevada. Prices of resale single family houses sold are currently averaging $426,000. New housing prices are even higher due to land, building material and labor costs. Current home listings, both resale and new, have a median price in Gardnerville of $549,000 and Minden it’s $574,950 (Altos data). Resale sales volume is twice new houses.
There is a lack of skilled, reasonable salary, residential construction workers. Sewer and water hook-up fees are extremely high. There are not enough new high paying local jobs where workers can afford new houses. Most California people moving to Nevada are going to Las Vegas, Reno, Arizona, Texas and Florida for lower price housing and/or better weather. The big builders are not coming to Douglas County as was envisioned when the Growth Management Ordinance was enacted. Douglas County has a large number of senior citizens, and when they pass on, their properties are for sale in competition with new houses. Many seniors also leave Douglas County for medical or family reasons. Recently, there has not been a big influx of new companies with a lot of high paying jobs, and one reason is insufficient affordable housing for workers.
Since 2014, Douglas County has seen only a 1.06% population growth. School enrollment for 2019-2020 is down 17.5% since 2005-2006. So, slow growth is being reflected in other areas as well.
I believe the factors above regarding building permits versus allowable allocations will not change for decades, hence Douglas County growth may be expected to remain lower than the 2% permitted under the existing ordinances. Slow growth will continue despite the false narrative and fear mongering we hear from some in the community.
Jeff Pisciotta is the owner of Jeff Pisciotta Builders in Gardnerville.