An Analysis of Growth in Housing Stock and Population: 1990-2000

An Analysis of Growth in Housing Stock and Population: 1990-2000

by: Brad Payne, Senior Statistician

"Northeast population grew (12.7%), twice as fast as housing stock (6.2%) over the past ten years."

This article highlights a new data series recently added to "Wyoming Economic Indicators," a table published monthly in Wyoming Labor Force Trends (see Wyoming Economic Indicators). The new data concerns building permits issued in Wyoming; the series is titled "New Privately Owned Housing Units Authorized." Throughout this article, Wyoming data will be presented with comparisons of state and county data for residential building stock and population. The analysis of the building permit data coupled with population data yields an interesting relationship.

On a monthly and annual basis, the United States Census Bureau estimates a data series called "New Privately Owned Housing Units Authorized in Permit-Issuing Places," more commonly referred to as building permits. This series is the source of the data provided in the Trends table and deals specifically with residential housing units.

The Census Bureau has defined a housing unit as:

A house, an apartment, a mobile home or trailer, a group of rooms or a single room occupied as separate living quarters or, if vacant, intended for occupancy as separate living quarters. Separate living quarters are those in which the occupants live separately from any other individuals in the building and which have a direct access from the outside of the building or through a common hall.¹

According to this definition, each unit in an apartment building, condominium building, or senior housing project is counted as one housing unit and is added to the number of houses to compute a total housing unit number.

For comparative purposes, we have calculated a percent growth in building stock by taking the number of building permits issued over the past ten years and dividing the total by the housing stock in place in 1990. The percent growth in population was also calculated in order to compare growth in population against growth in the number of residential housing units available.

A strong correlation exists between changes in the housing stock and changes in the population. As the population increases in a given area, it is reasonable to believe the number of residential structures would increase as well. Figure 1 illustrates the positive relationship between the two variables, population and housing stock, using all 50 states and the District of Columbia. The only exception to the positive relationship, the District of Columbia, showed a population decrease over the past ten years while the housing stock increased slightly. The data suggest increased population is a good indicator of increased housing stock and an increase in housing stock has far reaching implications. For example, issues relating to infrastructure (e.g., roads, sewer and utilities), traffic, property values and taxes need to be addressed.

Wyoming’s population grew 8.9 percent from 1990 to 2000 while the residential building stock grew 8.2 percent. The data follow the trend seen throughout the United States. However, compared to the six contiguous states, Wyoming’s growth is undramatic (see Figure 2). Wyoming’s residential building stock outgrew only Montana, which added 7.0 percent to building stock while experiencing 12.9 percent growth in population. Utah, Colorado and Idaho added substantially to their building stock with growth of 30.1 percent, 25.9 percent and 25.9 percent, respectively. Nebraska added 12.7 percent to its stock, while South Dakota added 12.2 percent. Figure 2 shows the surrounding states’ population growth compared to the growth in housing stock. The growth in housing stock shows a positive linear relationship with the growth in population.

To better understand growth within Wyoming, we can look at regional patterns (see Map for regions). With the exception of two regions, the growth in housing permits was consistent with the state population growth of 8.9 percent. As Figure 3 shows, the Southwest Region showed housing stock growth of 15.1 percent while the Central Region grew by a mere 3.4 percent. At the regional level, the addition of population data is consistent with reports of a housing shortage in the Northeast (specifically, Gillette). Figure 3 shows Northeast population grew (12.7%), twice as fast as housing stock (6.2%) over the past ten years. Again, as recent reports have stated, this housing shortage is related to the oil and gas industry’s growth in the Powder River Basin.² Breaking the Northeast Region down to the county level, Figure 4 shows stronger population growth in Campbell, Crook and Johnson counties compared to poor growth in housing stock.

Growth in housing stock varied widely by county between 1990 and 2000 (see Figure 5). For example, Teton County’s housing stock grew by 35.3 percent while Hot Springs County’s grew by only 1.5 percent. Other large gains in housing stock were found in Lincoln County with 22.6 percent growth, Sublette County with 22.1 percent growth and Park County with 15.9 percent growth. Again we can compare population data to the housing stock data and identify another problem area. Figure 5 shows population growth of 63.4 percent in Teton County. As mentioned above, Teton County housing stock grew only 35.3 percent. This is by far the largest difference in the state, followed by Campbell and Johnson counties.

One explanation for how differences of this size can exist is vacancy rates. The vacancy rate is the percentage of total available housing units not being occupied. At the end of 2000, Teton County had a homeowner vacancy rate of 1.3 percent and a rental vacancy rate of 5.2. These rates are down from the 1990 rates of 1.5 percent and 17.4 percent, respectively. The 2000 rates for homeowner and rental vacancy in Campbell County were 1.2 and 9.0 percent (down from 1990 rates of 3.6% and 19.4%) and in Johnson County were 1.8 and 3.8 percent (down from 1990 rates of 3.0% and 14.7%).³ A second explanation for the difference is that Teton County's population was significantly undercounted in the 1990 census. The undercount in 1990 would cause the population growth over the ten year period to be overstated.

In contrast to the problems illustrated by Figure 5, we can also see some counties performing very well with regard to growth in both housing stock and population. For example, Sublette County increased housing stock by 22.1 percent and population by 22.2 percent. Laramie County increased housing stock by 11.3 percent while population grew 11.6 percent, and Sheridan County increased housing stock by 10.0 percent and population grew by 12.7 percent. These counties, as well as others, demonstrate the correlation between building permits and population.

In summary, we see that Wyoming’s total residential building stock is keeping pace with the population growth and that any shortages in housing units are confined to localized areas within the state.

¹U.S. Census Bureau, "Frequently Asked Questions," Census 2000 Housing Units, http://quickfacts.census.gov/hunits/faq.html (June 12, 2001).

²"Gillette Housing Falls Short as Gas Booms," Casper Star-Tribune, Friday, June 1, 2001, p. B1.

³The 1990 data was extracted from American FactFinder located on the Census Bureau web site at http://www.census.gov. The 2000 data was taken from the publication U.S. Census Bureau, Profiles of General Demographic Characteristics 2000 Wyoming, 2001, pp. 1-24.

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