The District's housing market hit rock bottom in 1996, when no building permits were issued in the city, but home construction in the nation's capital has been steadily climbing back since, according to a nationwide study.
Baltimore's housing market, on the other hand, is deteriorating, according to the report, with new building almost at a standstill.
The study, done by the Brookings Institution's Center on Urban and Metropolitan Policy in collaboration with Harvard University's Joint Center for Housing Studies, found that Washington's housing market was the worst out of the country's large cities in terms of new construction in 1996.
The study found that, overall, the number of new homes built in America's major metropolitan areas has been growing steadily since the early 1990s and is "nearing the peak level of the real estate boom in 1986." Between 1991 and 1998, the number of new homes built grew by nearly 78 percent.
More than 80 percent of the new homes were built in the suburbs, the study found. But many large cities within the major metropolitan areas also experienced rapid gains. The number of new housing permits in the cities more than doubled over the eight-year period. That's a faster rate than that of suburbs and of metropolitan areas in general.
"Washington hit bottom when other cities were already rebounding," said Alexander von Hoffman of the Harvard Joint Center, author of the study. "Nobody wanted to build even a little cottage in Washington." That was a time when the city was working through the worst of its financial crisis.
By 1998, however, 429 building permits were issued in the city. And that number continues to increase: According to data assembled by the market research firm Regis J. Sheehan & Associates, 449 permits were issued in the city in the first 10 months of 1999.
The Brookings-Harvard study found that home building was booming in some large U.S. cities last year but stagnating in others. The report looked only at the country's 39 largest metropolitan areas and at the large cities inside those areas.
Baltimore's record is getting worse, the report showed. In 1998, only 64 permits for new construction were issued in the city. That's down from 107 in 1996 and 530 in 1991. In 1998, Baltimore ranked second lowest in the country in terms of new building permits, after Providence, R.I., according to the report.
"Despite Baltimore's urban renaissance projects such as the [Harborplace] festival marketplace and Camden Yards baseball complex, home building there has come to a virtual standstill," the report said.
It identified several "hot" cities in terms of new home construction. They were: Seattle; Orlando; Boston; Miami; Columbus, Ohio; Portland, Ore.; Tampa; New York; San Francisco; San Antonio; Phoenix; Houston; and Dallas.
"Cold" market cities, where relatively few new housing permits were issued, included Baltimore; Providence; St. Louis; Sacramento; Detroit; Philadelphia; New Orleans; Chicago; Kansas City, Mo.; and Los Angeles.
The study compared the number of building permits issued in the country's largest cities and metropolitan areas in 1986, a boom period; 1991, the bust after the '80s boom; and the revival year of 1998, when the nation's housing market came out of recession.
"Since the early '90s, a number of cities have participated in the rebound," said Nicolas Retsinas of the Harvard Joint Center. "At the same time, the trend for this century has also continued of every generation of Americans being more suburban than the last."
When the District had its zero year in 1996, its metropolitan area boasted 27,586 permits, showing the growth of the suburbs at a time when building in the city was nil.
In 1998, the Atlanta and Dallas areas led the country in terms of building permits, followed closely by the Phoenix-Mesa area. Las Vegas--often rated the fastest-growing city in the country over the past few years--was not evaluated because it is not in one of the 39 largest metropolitan areas in the country.
According to the study's author, Detroit is in a bad situation.
"Detroit faces one of the toughest challenges of any large American city," von Hoffman said. "There is such a concentration of poverty in that city."
Number of permits issued for new homes:
While home construction in the District has recovered since 1996...
. . . construction in Baltimore has slackened.
SOURCE:Center on Urban and Metropolitan Policy