A report by Dodge Data and Analytics finds construction of new homes – both apartments and single-family homes – is down by 16 percent in the first seven months of 2016 compared to last year.
Nonresidential construction is also down, by 23 percent.
Bill Gilmer, who directs the Institute for Regional Forecasting at the University of Houston, is not the least surprised.
“It recognizes that the apartment market is seriously overbuilt,” he said. “And that we really don’t need to be building any more apartments here in Houston right now.”
Gilmer expects the number of new apartments coming online to drop significantly next year.
Richard Branch, an economist with Dodge Data and Analytics, said this is the second straight year that construction is down in Houston, after going up every year after the Great Recession in 2009.
But the same is not happening in other metro areas.
Branch said that shows how much Houston’s economy is still reliant on the fortunes of the oil and gas industry.
“In terms of the number of people employed in the energy sector or related to the energy sector – whether that’s construction or in business services, you know, accountants, lawyers – that still has a broad-ranging effect when you see one section of the economy hit such a precipitous decline,” he said.
Branch said new construction related to education is up, but in most other sectors, like offices, retail, hotels or healthcare, it is down.