This blog was part of an ongoing series of educational classes and attempts to summarize some of the development projects happening in Huntsville, AL, around the time of this post. This blog does not include every project and is subject to change. Nothing in this blog should be used in place of actual legal advice. Please contact the City with any questions regarding development projects.
[DENNIS MADSEN]: I’m going to be talking a little bit about the past and the future today. We’ll be starting with our Development Review – we publish this annually on the City’s website and it is an assessment of things like building permits, CETOs, real estate performance, commercial developments, etc. in the city throughout the course of the year. It helps give an idea of whether we’re seeing year-over-year increases or decreases in things like single-family homes vs. multi-family homes.
THE HUNTSVILLE DEVELOPMENT REVIEW 2024
This review is free to access or download on the City’s website. We also have a monthly update you can access as well.
We’ll start with Residential. Please note that there is a difference between permits and COs – permits are sort of a peek into the future of housing development as they show the housing developments that are going to be coming in the next year or two, whereas COs are the units that have been completed. These two together give us an idea of what’s been done and what's on the horizon so we can compare and stay on top of trends.
RESIDENTIAL PERMITS
- 2507 units permitted (43.2% decrease from 2023)
- 1,116 single-family units (5.3% decrease)
- 1,391 multi-family units (57% decrease)
- 10-year average: 3,228 building permits (pre-2020 average was 1,860)
The decrease we saw in 2024 wasn’t really concerning because we had been having some historic years for building recently, so things are now starting to even out. While it is a drop, it is still well over our pre-2020 average.
For one of the first years in a long time, downtown (red circle) had a lot of permits – in no small part due to some of the apartment developments we’re seeing downtown. The blue oval you see out to the left is the Providence area and we’re seeing a lot of permits in that area.
RESIDENTIAL CERTIFICATES OF OCCUPANCY
- 6,404 units granted (36.5% increase from 2023)
- 1,193 single-family units (3.9% decrease)
- 5,211 multi-family units (51% increase)
Huntsville added more housing units in 2024 than any other year since the Development Review began keeping records in 1983. This is the third year in a row of record-breaking numbers in new housing developments. A lot of the increase in COs from the past year was because many of the multi-family units that had been in the pipeline were finally completed. Whereas residential development tends to stay at a steady increase, multi-family sort of goes up and down – a lot of that is due to the steps involved in getting these developments started, but it’s also due to the level of national investment. In Huntsville during the past 20 years, there were some years where we didn’t build any multi-family units at all, so we can argue that multi-family was very under-built here for some time and now we’re playing a bit of catch-up.
The above image shows that we’ve got a bit of development happening all over and it isn’t just restricted to one or two small areas. In the far West we’re seeing a lot in Providence and Mooresville – we’ll likely be seeing even more out in the Mooresville area because we recently annexed a large piece of land on the other side of it.
This only includes areas incorporated in Huntsville City boundaries, so this doesn’t include areas of Madison or unincorporated Limestone County. You can see in this image that we’re seeing a lot of single-family residences going into the Owens Cross Roads area.
One other metric we track is single family additions and alterations because this shows how much money is being reinvested back into the existing neighborhoods. In 2024 there were 814 permits granted for this type of work, and that was an 8.2% decrease from 2023. This decrease was really just because we had seen such a large uptick in renovations over the past few years, so a lot of investment is still occurring, just not at the heightened levels we’ve been seeing. Last year was exciting for us because we saw a lot of investment in the South Huntsville area, which hadn’t seen much in a while – we typically see this as a sign of nesting, which is when young families are moving into an area and you start to see churn. Within 5 or 10 years of this, school enrollment starts to go up, which is a really good thing not just for our city but also for the school system.
MULTI-FAMILY DEVELOPMENT
I wanted to make sure you had some accurate numbers here because unfortunately in the media multi-family is often miscounted – they sometimes count the permit and the CO as a separate unit, which inflates the numbers.
- 8,461 units under construction
- 43 complexes
- Includes 12 single-family rental developments
- Apartment units completed in the City of Huntsville between 2020 and now: 7,535
You’re looking at around 16,000 multi-family units either completed or under construction in the last 5 years. That’s a lot of multi-family, but we’re also adding roughly 17 people a day in population just in the city of Huntsville, and one of the best ways to absorb growth is through multi-family units.
When you are building multi-family, you want to be very cognizant of where you’re putting it. This looks like it’s scattered everywhere, but most of it is focused on major arterials that can accommodate that kind of traffic and density. Though we’re seeing a lot in the downtown area, we’re also seeing quite a bit in the east, west, and south, which is good because it’s starting to spread that growth across the city and mitigate any impacts on infrastructure. One of the biggest areas we’ve seen multi-family going in is that intersection of Hwys 72 and 255, or University Dr and Research Park Blvd. We’re starting to see the foot pull off the gas a little bit on multi-family – some of that is nationally, but it’s also locally and regionally. It’s getting a little harder to finance. We’ll probably see pretty large CO numbers in the next Development Review only because we still have a lot in the pipeline, but in the permit area we’re seeing those numbers start to come down.
SUBDIVISIONS
Subdivisions are the precursor of single-family development. We saw a bit of a decrease in single-family lots, but these numbers are still well over our average.
- 1,003 single-family lots
- 21.5% decrease from 2023
- 40-year average: 784 lots
- 1,406 multi-family units
- 0.8% increase
- 56 non-residential lots
We’re starting to see a bit more competition in land that’s able to be developed even despite the annexations, so we’re trying to get creative on where new subdivisions can occur.
REAL ESTATE
These numbers are based on MLS data in the City of Huntsville.
- 3,015 single-family residential units sold
- 15.7% decrease from 2022
- Average sales price, single-family residence: $396,788
- 3.8% increase
- Average price per sq ft: $167.95
We did see a bit of softening in the year-over-year price increase – for a while there we were seeing close to double digit increases every year. We like to see that soften a bit because we are still wrestling with issues of affordability. Compared to many other metros like ours we are still considered relatively affordable, but in terms of the baseline there are still plenty of folks who are worried about pricing. Affordability is one of Huntsville’s competitive edges, so we do want to make sure that we stay an affordable community so we can attract workers.
One thing that’s interesting and that we’re monitoring closely is the sales price change by census tract. A lot of that blue up in North Huntsville is in an area of the city that has been historically neglected but as land develops and space comes at a premium, more folks have been interested in developing up there so you’re starting to see an uptick in price in this area. Though we do love to see investment in areas that have been neglected historically, it can also raise issues of possible gentrification. This is another reason we want to keep an eye on issues of affordability so that we can ensure we aren’t seeing an excess of displacement along with these new developments and price increases.
COMMERCIAL AND OTHER DEVELOPMENTS: NON-RESIDENTIAL PROJECTS
We also track a little bit of the commercial side of developments as well. These numbers also tend to bounce up and down.
- 574 building permits issued
- 4.2% increase from 2023
- Top tract: 31 (downtown)
- Large commercial projects:
- Front Row – one of the largest downtown developments you’re going to see for a while
- Huntsville Logistics Center
- Huntsville International Airport
- Stadium Commons
ANNEXATIONS, ZONINGS, AND REZONINGS
We had a relatively slow year for annexations last year with almost 90 acres annexed. We’ve already blown past that this year, particularly with the Mooresville annexation which is well over 300 acres. You all know this, but I always have to offer the caveat: a lot of folks want to know why Huntsville is grabbing all this land, but we do not force annexations. In extreme cases driven by infrastructure need we may require it, but these annexations are all generally petitioned by the people who own the property. Many people want to be annexed into Huntsville, including the owner of this large Mooresville property, because they typically want the services that the city provides. You’ll see more about this Mooresville development soon, but it will likely be a very large development – think Providence on steroids.
POPULATION
As of the end of 2024, Huntsville has a population of 246,000+ people, which is an increase of 14.5% since the 2020 census. We are the fastest growing major city in Alabama with an average annual growth rate of 2.1%, and we’ve been bumping up against 3% for the last few years; anything between 1-2% is considered pretty robust for a city our size.
This is our favorite graph to show the folks in other major Alabama metros just to give them a little jab. Birmingham is going to be the biggest metro in Alabama for a long, long time as they also have a lot of other larger cities around them, but in terms of city boundaries and population, Huntsville has cleared that hurdle and has kept on going.
A lot of population growth means we need to add a lot of housing. We’ve seen 6,281 housing units added last year, an increase of 5.6% from 2023. We now have a total of 119,030 housing units, which is a good metric. This is almost one housing unit per two residents, which is within the target we’re aiming for. As long as we’re going to continue to grow, we need to make sure we’ll also continue to be able to provide new housing for residents.
This next graph shows the changes in which people are buying houses. Back in the late ‘60s, the predominant household by a huge margin was the “Leave It to Beaver” household – mom, dad, two kids. They were the primary consumer of housing at ⅔ of that makeup. In the last almost 50 years, they have become less than ⅓ of the household makeup while every other household makeup has increased. This matters because each of the listed household types tends to look for different things when purchasing property. One of the challenges here is that our housing market has been okay at responding to this trend in some cases but slow to respond in others. We’re still building a lot of housing for that formerly oversized demographic and we have not done a great job of pivoting to these other demographics and household types.
As we approach 2050, we are going to have a lot of seniors and not a lot of replacement population. This has a major impact on what kind of housing needs to be built and where it needs to be built. The following is a quote we use a lot when we talk about building “missing middle housing” to answer this shift in demand.
We are already seeing the market changing a lot in this respect with things like the development of a lot of small-lot patio homes. It’s not just about the retirees, but also the pre-retirees or “active lifestyle” community – folks who don’t necessarily want to go up and down the stairs as much, they want a yard but not as much yard to take care of. Twenty years ago this type of home was not built heavily at all but is definitely starting to increase now. Townhomes are becoming increasingly popular. We’re also seeing an increase in more planned developments that cater to seniors, such as ones that provide shared amenities. Things like townhomes and quadriplexes were very popular pre-war – this provided a lot of diversity in housing types, which allowed folks to right-size their housing, and we’re starting to see that push into the market again now, though we’d like to see it happen a little faster.
Depending on who you talk to, we’re underbuilt in housing nationally by between 2-6 million units. The last presidential cycle was fascinating in this way because both candidates emphasized the issue of housing supply and needing to get more housing on the ground. It’s important, though, to not only continue building the same type of housing we’ve been doing for 50-60 years; we need to add a little more diversity with things like multi-generational housing because a lot of people will have parents who have to move in with them – either a main house with an accessory dwelling unit or a single home with two primary bedrooms, sometimes with one upstairs and one downstairs.
You can find the full Development Report online here:
https://www.huntsvilleal.gov/business/economic-development/huntsville-development-review/
We also post a Stats Summary, which is updated monthly, here: https://maps.huntsvilleal.gov/permitstats/
I don’t only want to talk about the past, though; we also have a lot on the horizon that we’re excited about.
MILL CREEK CNI
We realize that we need to prioritize what’s affordable up and down the spectrum, but the challenge is providing affordability to folks who make 30-60% of the area median income (AMI). This usually takes more substantial intervention, for example the Mill Creek Choice Neighborhoods Initiative in conjunction with the Huntsville Housing Authority. CNI is a HUD program that provides a cash infusion into a development to help it redevelop and continue to provide workforce housing. For anyone not familiar with it, the Mill Creek CNI area is just west of downtown around the pizza slice of where Clinton and Governors intersect.
The existing site plan is currently Butler Terrace and Johnson Towers. Older public housing developments were very low density and not particularly well-thought out when they decided on how they’d be laid out, and with the federal housing assistance budgets getting slimmer and slimmer each year it can be difficult to implement new housing in the area. The CNI program helps leverage this land value the Housing Authority is sitting on for new housing. So over time, eventually all the existing housing will go away and we will gain all-new housing that will be a mixture of public housing, senior housing, workforce housing (housing meant for those making 60% of AMI), and market-rate housing. A private developer will fund the redevelopment and make their profit off the market-rate housing, and in exchange the Housing Authority will offer the land at a subsidized cost. So through this as well as grants and low-income housing tax credits, we can create housing for multiple demographics.
One of the things I’d like to highlight on this plan is that right along Seminole Dr you see an upside-down U-shaped housing development and that is Huntsville Hospital’s housing development. They were so excited to hear about this neighborhood and develop their own workforce housing within it, so HH is building their own 125-unit housing complex for their own employees as part of this development. The City and the Huntsville Housing Authority are doing the infrastructure and Huntsville Hospital is building these 125 units on this land because they have seen the need to have workforce housing downtown and have their employees be able to stay close. They are not targeting their doctors for this housing; this is more for employees like their on-site phlebotomists, their orderlies, the folks who work in linens who need to be close to downtown but are likely starting to be priced out of living in the area.
Phase 1 & 2 will go in first, and then we will take down Johnson Towers, which will free up the rest of the area to begin the final phases.
Oftentimes around the country you can fairly easily identify areas of public housing – it has a distinct look to it and you can tell that’s the type of public housing they were developing post-war. HUD’s goal with this is to make sure that it does not look like public housing and is instead indistinguishable from market-rate housing. Because this is a mixed-income development that will differ building to building (we won’t have all the public housing on one side and all the market-rate housing on another, it will all be mixed throughout), that means there is a real premium on design here to create a livable neighborhood. We’re really putting an emphasis on architecture and trying to take cues from some of the Mill architecture around there. The streets will be pedestrian-scale and well-planted. The entire development will begin this year and be finished within 8 years.
Some additional efforts we’re putting toward affordable housing are zoning updates to allow for more mixed-use development; continued support of partner organizations such as Habitat for Humanity Neighborhood Concepts, and the Housing Authority; and we have hired an Affordability Coordinator.
ROAD NETWORK INVESTMENT
As we continue to grow, we’re putting a lot of investment into our road systems and are working diligently to ensure we keep traffic moving around the region.
- There is currently over $400m in active State/Federal road projects in the region
- New routes are creating a more resilient network
It isn’t only about roads, though – we also need to expand transit not only for those who need to use it, but we also want to make it a feasible option for those who don’t necessarily need to use it but choose to.
- Regional high-capacity transit study completed by the MPO
- Huntsville Transit has regularly updated their service
- Pilot BRT project planned for University Drive
- New transit center to accommodate growth
Through the Complete Streets initiative we are ensuring new and existing roads accommodate all users – vehicles, bikes, and pedestrians. This will improve mobility, accessibility, connectivity, and safety. We are also filling in the gaps for the cycling community with Bike the Rocket City; this is an MPO-wide update of the regional bike plan and will focus on both long-and short-term projects.
SKY BRIDGE
This is the sky bridge that will connect the Mill Creek area to downtown for both bikes and pedestrians. There are two fairly significant federal grants that are helping to fund this. It will not only improve accessibility to downtown but will also include some creek improvements to those two culverts by the VBC.
This should begin this year, but things have slowed a bit in terms of the two federal grants with the recent change in administration. We still feel comfortable saying it will be moving forward, but it is just a slower process now trying to move around that grant paperwork.
NORTH HUNTSVILLE GREENWAY
One of the projects I’m most excited about is the North Huntsville Greenway. At one end of this is the Sky Bridge, so where the Sky Bridge drops down the Greenway will pick up, the idea being that you can take this pathway through Lowe Mill, through John Hunt Park, through downtown, and all the way to Alabama A&M. The long-term vision is for this to connect all the way from Ditto Landing to Alabama A&M, creating this huge north-south spine connecting the city.
This really pays homage to the Atlanta Beltline, and we’re excited not only about the trail but also about how this area generates activity, economic development, neighborhood improvements, and community engagement all along it. We intend for this to be a hotspot for local pop-up events such as parades and festivals and art shows and more, as well as an opportunity for nature education but having it double as a sort of arboretum. We’re also pitching the idea of an incubator space where local businesses can rent a storefront for a period of time to see how viable their business is before they commit to a long-term lease in the city – we hope to see things like breweries and coffee shops and snack spots along the trail. In Atlanta this was one of the most transformative public projects to ever happen in the city, and we hope it will be the same for Huntsville.
Some good investment in infrastructure like this can help Huntsville become even more Huntsville, and I’m very excited to see where this goes.
What’s really going to help us absorb a lot of the growth coming our way is offering more transportation choices – the majority of people will always choose to drive places, but offering more bikeable and walkable routes will help relieve some traffic congestion. Post-war, the habit was to put all residential in one area of the city, all employment in another, and all shopping in another area, which basically forced you to drive anywhere you needed to go. We’re now trying to re-knit our community together, which you can see in the reinvestment in downtown, in places like MidCity and Providence and Hays Farm where land use is being brought back together. So it’s not always about making it quicker to get from point A to point B, but actually bringing point A and point B closer together.
Dennis Madsen
Manager of Urban & Long-Range Planning, City of Huntsville
256-427-5100
