Springfield, September 25, 2025
News Summary
Springfield is struggling with a housing shortage as new construction slows and costs rise. With only 129 new residential permits issued recently, the city’s housing market is under increasing strain due to a growing population and declining household sizes. Economic experts suggest a national shortfall of 5 million housing units. Labor and material costs are soaring, further impacting affordability. Springfield’s development code is being updated to encourage diverse housing options, but significant measures are needed to address these challenges and improve the housing landscape in the city.
Springfield Faces Housing Shortage Amid Slow Construction and Rising Costs
Springfield, like many cities across the U.S., is grappling with a critical housing shortage as new construction lags and costs continue to rise. The issue has been a prominent topic at recent Planning & Zoning meetings and discussions among City Council members.
In 2024, Springfield issued a mere 129 permits for new residential builds. This number mirrors the levels seen before the pandemic but is notably lower than figures recorded prior to the Great Recession of 2007-2009. Despite Springfield’s population steadily growing over the last 20 years, the pace of housing development remains alarmingly slow.
Nationwide, the construction of new houses decelerated following the subprime mortgage crisis, with recovery times proving lengthy. For the past two decades, approximately 1.5 million new homes have been constructed annually across the United States. However, this growth is failing to keep up with the rising population, intensifying the strain on the housing market.
A long-term trend of decreasing household sizes is also fueling demand for new housing units. More individuals are opting to live alone or postponing family formation, further compounding the housing issue. According to estimates, there could be a shortfall of 5 million housing units nationally, as noted by economic experts.
In the Springfield metro area, the Home Builders Association has reported a 13% drop in building permits for single-family homes as of July 2025, compared to a national decline of only 6% and a state-level drop of 4%. This decline is concerning, especially as building permits for multi-family housing within Springfield have seen an increase of over 30% year-to-date, highlighting a shift in housing demand.
The construction industry is also grappling with a tightening workforce, which is impacting the speed and number of projects completed. There is a noticeable lack of younger individuals entering the trades, as older contractors opt for retirement. In response, various educational programs and grants are being introduced to foster new entrants into the construction field.
Compounding these challenges are the soaring costs of labor and materials, which remain elevated since the COVID-19 pandemic. Economic uncertainty resulting from fluctuating tariffs is further driving expenses upward. As a result, housing affordability has plummeted to an all-time low, with both housing prices and mortgage rates having doubled post-pandemic while wages have not seen corresponding growth.
The median price for a new home in Springfield stands at approximately $417,500, making housing unaffordable for more than 84% of local households. Each $1,000 increase in home prices translates to an additional 161 households being priced out of the market.
Additionally, the low turnover rate of homes is negatively affecting the market, with homeowners choosing to remain in their properties longer due to ultra-low mortgage rates. The average turnover rate has increased from every seven years to every 14 years, further constraining available housing options.
While the Federal Reserve has announced interest rate cuts, much larger and more impactful measures are needed for the housing market to experience a positive shift. In Springfield, the limited availability of land for development is compounded by regulatory challenges and pushback from residents, particularly on the outskirts of city limits.
Springfield is currently in the process of updating its development code to streamline the approval process and encourage a more diverse range of housing options. The efficacy of this new code, which is still under testing and expected to run until 2026, remains to be seen.
Overall, resolving Springfield’s housing issues will likely necessitate a broad approach focused on overall housing turnover rather than relying solely on new construction. The challenges ahead seem daunting, but addressing these needs will be crucial for the city’s future.
Deeper Dive: News & Info About This Topic
Additional Resources
- News Leader: Springfield Housing Construction Remains Slow
- Springfield News Sun: Springfield’s Housing Market Hurdles
- MassLive: Springfield Developer to Begin Construction on Home Development
- Wikipedia: Housing Crisis
- Google Search: Springfield Housing Market
Author: Construction FL News
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