fb-pixelN.H. granted more residential building permits in 2022 than in 2021, per new report - The Boston Globe Skip to main content
HOUSING

N.H. granted more residential building permits in 2022 than in 2021, per new report

Housing experts say it’s a positive sign, but the state will need to maintain its momentum in order to address the housing crisis

A sign announcing a house for sale is posted outside a single family home, Tuesday, Feb. 7, 2023, in Exeter, N.H.Charles Krupa/Associated Press

CONCORD, N.H. – There was an 18 percent increase in residential building permits issued from 2021 to 2022, according to a new report from the New Hampshire Department of Business and Economic Affairs.

That meant the addition of 5,726 permits for homes in 2022, including permits for 3,098 units in multi-family buildings and 2,495 permits for single-family homes.

Permits for multi-family buildings represented more of the growth, increasing by 40 percent from 2021 to 2022, while permits for single-family homes fell slightly over the same time period.

But the report noted that growth has not happened evenly across the state, and instead, it has been concentrated in roughly a dozen communities around the state.

Advertisement



“...There is a marked shift towards the majority of housing units permitted being concentrated in fewer and fewer municipalities,” the report found.

Those leading the pack include Salem (470 units), Portsmouth (404 units), Londonderry (321 units), Rochester (287 units), Manchester (263 units), Lebanon (262 units), Laconia (135 units), Conway (131 units), Concord (110 units), Dover (102 units), Nashua (101 units), and Swanzey (100 units), which all saw permitting “significantly increased.”

Just 13 communities that make up 34 percent of the state population accounted for half of the housing units permitted, while the 221 other communities permitted the other half of units.

The latest report showed the state continuing on an upward trend, increasing permits for new housing since 2011, except for 2013 and 2020, when numbers dropped slightly or stagnated.

Over the past two decades, the rate of building reached a peak in 2004, when the state added over 9,000 new units in one year, before dropping precipitously and reaching its lowest point in 2011, when only around 2,000 new units were added.

Governor Chris Sununu celebrated the increase, which he credited to InvestNH, a $100 million program funded through the state’s American Rescue Plan Act, designed to speed up construction of affordable workforce housing.

Advertisement



“By focusing our efforts on delivering affordable housing to communities across New Hampshire, this program has a real impact for Granite State families and allows employers additional opportunity to attract new workers from beyond the 603,” he said in a statement.

The money went toward multifamily rental housing for people earning up to 80 percent of the area median income, with $60 million going to a grant program for developers who add housing stock and $40 million to municipalities who can get funding to update regulations and demolish vacant buildings, according to the department.

Projects have been completed in Concord, Conway, Manchester, Lebanon, and Littleton, which brought 129 new units to market, and 88 percent of them are affordable housing, according to Sununu.

The state still has a long way to go before reaching the 90,000 units needed by 2040, according to New Hampshire Housing. From 2000 to 2010 the state added over 67,000 units, but in the following decade, growth withered, with just over 24,000 units added.

“My initial reaction is one of excitement because we’re starting to see the fruits of our labors,” said Ben Frost of the new report. Frost is the executive director and chief legal officer of New Hampshire Housing, a public corporation created by state law in 1981.

Frost agreed with the governor that the InvestNH program has been spurring growth, through grant funding that has helped developers reach a favorable economic equation to advance projects even amid supply chain issues and the high cost of construction materials.

Advertisement



“The availability of this capital helped developers to overcome those barriers,” he said, noting projects that have languished for years and are now moving forward. One example is Dexter Richards and Sons Woolen Mill in Newport, which will provide 70 units of housing.

But, he said, the momentum needs to be maintained. He believes that can be accomplished as municipalities make changes to local zoning so that it is friendlier to development, noting that many communities have exclusionary zoning rules on the books that put a stranglehold on development following periods of extremely high growth in the state in the 1970s and 1980s.

“It’s made it difficult for the market to meet the demand for housing,” he said.

Jason Sorens, senior research faculty at the American Institute for Economic Research, said the report was good news when it comes to supply, but he expects 2023 numbers to be lower. “Across the US, residential construction rose a lot in 2022 because of low interest rates, but then fell last year as rates rose,” he said in a text message.

If all the units permitted in 2022 are constructed, the state estimates the total housing supply was 653,390 units, as of 2023, about 2.4 percent more than the number of units in the 2020 census.

But, according to the report, only two of nine Regional Planning Commissions are on track to actually produce the number of housing units needed by 2024, as set out in a spring 2023 assessment.

Advertisement




Amanda Gokee can be reached at amanda.gokee@globe.com. Follow her @amanda_gokee.