The Building Congress, which promotes the construction industry, estimates that while residential construction spending will reach a new record high of $10.2 billion in 2014, only about 20,000 new units will be created.
That is a 9% increase from the number of units created in 2013 but still significantly below the more than 30,000 units that were constructed annually between 2005 and 2008.
But regardless, the current boom in residential construction has created thousands of new construction industry jobs and increased economic activity and tax revenues. In fact, the Building Congress report predicts that the residential sector will single-handedly lift total construction spending across all sectors by 10% this year over last year's level.
In contrast, spending on non-residential buildings, which includes commercial office towers, is expected to dip slightly from last year's $8 billion figure.
One area of concern, however, is the relative lack of new housing that is being created by virtue of all this residential spending.
Experts point to the high cost of land, which makes it difficult to build anything other than luxury condos. Rezoning has also made it difficult to build in some parts of the city where land might be cheaper.
Developers also face significant challenges navigating the city’s bureaucracy. Mayor Bill de Blasio has also pledged to make the Department of Buildings easier to navigate for smaller developers in the outer-boroughs.
While the luxury residential market is booming in Manhattan and in parts of Brooklyn and Queens, the city has its work cut out for achieving Mayor de Blasio’s plan to create or preserve 200,000 units of affordable housing over the next decade.
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