In 2006, two years before the fallout created by the plunge of the stock market, America saw a rash of irresponsible mortgage lending. Mortgages were heaped on folks with poor credit histories who struggled to repay them.
As default began to pile up, not only was the stock market and the big financiers on Wall Street in trouble, but trouble on Main Street soon followed. By the end of 2008 the housing market in Chesterfield began to suffer and the number of building permits fell, just as some builders took huge losses and some went out of business or filed for bankruptcy.
The risky mortgages were passed on to financial engineers at the big banks, who turned them into supposedly low-risk packages putting large numbers of them together in pools. According to “Economist Magazine,” the big banks argued that the property markets in different American cities would rise and fall independently of one another. But this proved wrong. Starting in 2006, America suffered a nationwide house-price slump. Chesterfield enjoyed an increase in home values from 1998 to 2006 of between 60 and 80 percent but that didn’t last long.
When Chesterfield’s single-family building permits are tracked, the story becomes obvious, even though the county was somewhat behind the curve.
Some builders switched to apartment building while others were not quite so lucky. Single-family-building permits have now surpassed their 2008 levels, but the county is still recovering even though the building department has enjoyed a 23 percent increase in yearly residential permits since 2008.
In 2008, the number of building permits processed at Chesterfield’s building department was 864 for the entire year. In 2013, the yearly number was 1,065, the highest number of building permits in one year since 2008.
Chesterfield hit bottom in 2010 scratching up only 636 permits, far below the glory days of the 1990s.
Two years ago during his report to the Board of Supervisor relating to the county’s finances, the Director of Budget and Management department, Alan Carmody, suggested it would be a long time before Chesterfield saw building like it did earlier in the decade.
Now the county is on an upward swing since 2010, gaining 429 houses in the four years since then.
** While permits are counted as a home built may not have been built, a permit is valid for one year.