Top 10 cities for residential construction activity

While raw new home construction data shows that Houston issued the most construction permits in 2011, a recent analysis by Trulia looked at the number of permits issued per 1,000 existing housing units in 100 metropolitan areas. Using this approach, they were able to determine the top 10 cities with the most construction activity relative to their size.

The list of cities, along with their average number of construction permits per 1,000 housing units, includes:

1. El Paso, Texas (15.36)
2. Austin, Texas (14.49)
3. Raleigh, N.C. (13.66)
4. Houston (13.55)
5. Charleston, S.C. (12.80)
6. Dallas (11.26)
7. Little Rock, Ark. (10.53)
8. Baton Rouge, La. (9.51)
9. Washington, D.C. (9.44)
10. Columbia, S.C. (8.74)

Trulia analysts argue that this list provides a more definitive look at the breadth of new home construction across the nation, as larger metro areas would be expected to issue more permits.

The top 10 cities with the most construction permits issued include:

1. Houston (31,271)
2. Dallas (18,686)
3. Washington, D.C. (16,501)
4. New York (13,973)
5. Austin, Texas (10,239)
6. Los Angeles (9,895)
7. Phoenix (9,081)
8. Seattle (8,664)
9. Atlanta (8,634)
10. San Antonio (7,127)

From looking at both lists, Trulia points to two factors affecting the extensive growth of new home construction in these areas: long-term employment growth and smaller home price declines. Many of these areas have seen above-average employment growth, and they have managed to avoid the steep drop in home prices seen in the areas hit hardest by the housing crisis.

To read the rest of the Trulia analysis, click here.