- California’s housing construction permits have fallen sharply in 2025, according to a new analysis by Jonathan Lansner of the Southern California News Group, raising concerns about the state’s ability to address its persistent housing shortage.
California’s housing construction permits have fallen sharply in 2025, according to a new analysis by Jonathan Lansner of the Southern California News Group, raising concerns about the state’s ability to address its persistent housing shortage.
Lansner reviewed Census Bureau data and found that California issued 49,400 permits for new housing in the first half of the year, the lowest level since 2014, aside from the pandemic lockdowns. The figure marks a 3 percent drop from 2024 and a 14 percent decline from the construction surge seen between 2020 and 2023. Current activity is running 16 percent below the state’s 37-year average pace.
The slowdown comes amid elevated mortgage rates that have made it harder for projects to be financially viable. Many developers who expanded during the pandemic’s low interest rate era are now left with unsold homes or vacant apartments. Broader economic uncertainty under the Trump administration’s unconventional policies has also contributed to hesitancy among builders and consumers, Lansner reported.
Single-family home construction has been hit the hardest. In the first half of the year, California issued 29,500 permits for houses, down 7 percent from last year and 23 percent below the long-term average. Multifamily projects fared better, with 19,900 apartment permits filed, a 5 percent increase from 2024. Still, that total is 24 percent below the 2020-23 surge and slightly under the long-term average. Multifamily units made up 40 percent of all permits this year, down from 46 percent during the pandemic but above the historical norm of 34 percent.
The trend is part of a broader national slowdown. Across the United States, 725,400 permits were filed in the first half of 2025, a 4 percent decline from the prior year and 13 percent below the pandemic-era peak. Unlike California, national activity remains 7 percent above the long-term average.
Single-family development has been the main drag nationwide as well, with 483,800 permits filed, down 6 percent from last year. Multifamily permitting remained flat at 241,600 units, down from the pandemic boom but still well above historical levels. Multifamily accounted for 33 percent of all permits nationally, compared with 38 percent during the pandemic and 29 percent historically.
Lansner noted that, while the numbers point to a cooling market, the composition of new housing continues to shift, with multifamily projects claiming a larger share of the overall picture than in previous decades.
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“The slowdown comes amid elevated mortgage rates that have made it harder for projects to be financially viable.”
Talk to the Fed governors who are keeping rates high because of their hatred for Trump.
“because of their hatred for Trump.”
What is your evidence that they “hate Trump”?
Alright, maybe not hate, how about highly dislike.
As opposed to being inflation averse?
They cut the rates heading into the 2024 election in what many think was an effort to try to help democrats. Inflation was about the same it is now as when they cut those rates.
They have not cut rates since Trump took office in January.
Why? In my opinion it’s because they know cutting rates will help Trump. But now with the employment numbers being down they’re backed into a corner and it will be too obvious for them not to cut rates at the next fed meeting.
The Fed discovered that inflation was not falling fast enough to cut rates further. That’s called smart management. In addition, the economy has been functioning well up to this point. Cutting rates in the face of a rising economy is what leads to inflation. There’s not yet a justification for cutting rates. However, that would change with evidence of the economy stalling out, such as this decrease in housing permits. It all makes sense if you are willing to consider the deeper complexity.
“how about highly dislike.”
What is your evidence that they “highly dislike” Trump? And what is your evidence that any personal feelings they may have about Trump are affecting their deliberations and Federal Reserve board policies?
Don’t these people realize there’s a housing crisis? Also, what about the state’s mandates?
;-)
Seems to me that the state also lost quite a few houses during the LA fires. Are you sure we’re not going backwards?
Numbers are way down despite Newsom’s advocacy and the democrat’s supermajority in the State Assembly and Senate.
“Numbers are way down despite Newsom’s advocacy and the democrat’s supermajority in the State Assembly and Senate.”
It’s almost like they are doing a poor job while dominating the state government.
Speak loudly and carry a big wet noodle.
Given the slowdown is nationwide, it doesn’t appear to have much to do with state policies. I’d look at who’s in charge in DC…
LOL, he’s been there 7 months. How long have the democrats been running CA?
You guys are funny, CA is fighting everything coming out of DC these days but when something isn’t going right in the state it’s somehow DC’s fault.
Just so I’m clear, you’re acknowledging that there is a housing a crisis?
Not a crisis, more of a problem.
Just so I’m clear, are you acknowledging that democrat policies aren’t working?
Not so far – California has not done nearly enough to alleviate the housing “problem” and to the extent that the state is run by Democrats, it’s on them (I caveat that point because obviously there are deep cleavages within the Democratic party on housing that is part of the problem right now, imo). So what policies do you favor to alleviate the “problem”