The number of single-family building permits issued last year were the most this decade and represented a 14 percent increase over last year, the Rhode Island Builders Association recently reported.
There were 2,542 permits for new, single-family units pulled in the state last year, 312 more than in 1997.
“Residential construction is a fundamental indicator of Rhode Island’s economic strength,” said Roger R. Warren, executive director of RIBA. “These strong, building permit figures are an assurance that the state’s economy continues to grow.” Coventry led the state in the number of single-family permits with 200 being issued – more than a 48 percent increase. Other towns that experienced significant growth included Cranston, South Kingstown, Cumberland and North Kingstown.
Meanwhile, Johnston, Providence and Scituate were some towns that saw dramatic decreases in the number of permits issued.
Byrant College economist William B. Sweeney said the increase in construction falls in line with other indicators of a strong economy.
“An obvious explanation for the growth is low interest rates. Another fact is that the unemployment rate is just slightly above the national rate,” said Sweeney. He added that those two factors combined with increasing personal income are a winning combination.
He added, “There has also been very little increases in the price of building a house as well. So there has been some upswing related to that.”
Officials in towns experiencing the most growth expect a slowdown soon, if not already.
“What we are seeing here is the aftermath of a number of subdivisions being recorded,” said Charles Gricus, director of planning for the city of Coventry. “I think in the aftermath of the banking crisis there was a number of projects backed up and the growth was not spread out. So there was a two-year hiatus in development and now it is coming all at once.”
Gricus said the town’s planning commission expected the upsurge in development and they also expect it to die down.
“I’m thinking we are getting maxed out here,” he explained. “This is a pretty wet town. We have a lot of wetlands that will preclude a lot of development.”
Because single family homes bring with it many children, Coventry’s schools have felt the most stress. The town’s other services have also be impacted.
“In a way we have created our own problem, because we have a fairly low tax rate along with having good schools, recreation and other services. So people want to move here,” he added.
Warren of the Rhode Island Builders Association said from the developers to the sub-contractors the growth has been a blessing. Yet it has also raised a legitimate concern.
“I think one of the things holding us back in Rhode Island is the need for skilled labor. Companies have a backlog of work because they can’t get enough skilled help,” he said. “If we are going to take advantage of this growth into the future we need to attract people into the industry.”
