Development dream

There’s a California dream that with some prodding and looser regulations, builders will construct enough homes to lower the state’s high housing costs.

It’s a tad delusional because developers — whether they’re building housing to buy or rent — are not exactly willing to take on huge financial risks for construction that would ultimately crush property values.

Look at how California builders were acting this autumn. October was the seventh-slowest month for permitting since 2015.

You can argue about the size of the longer-view housing shortage all you want. But builders are focused on short-term profitability.

And maybe they know the housing shortage isn’t as big as some think.

Consider that since 2015, California has permitted 858,387 units — that’s 8% of the U.S. total construction plans for ownership and rental housing.

But California’s population grew by only 651,130 in the same period — just 6% of US growth. And the past two years, the statewide population has shrunk.

Next, ponder the balance of new places to live vs. how many folks actually live here. Over eight years, California permitted 130 housing units for every 100 new residents. That surplus is hopefully making a relative dent in housing costs.

Compare that with the national ratio of 100 homes for every 100 added Americans. Texas and Florida are both losing ground, with just 60 units permitted for every new resident.

October may be just one month. But it’s a lesson in how quickly builders will pull back when conditions aren’t perfect.