Privately-owned housing starts in August grew at a seasonally adjusted annual rate of 1.282 million units, according to new data from the U.S. Census Bureau. That was a 9.2 percent increase from July’s upward-revised print and better than expected. Regionally, housing starts were unchanged in the Northeast last month and rose in the West (19.1 percent), the Midwest (9.1 percent), and the South (6.5 percent). Most of the headline gain was due to multi-family units (rentals), which jumped by 27.3 percent in August, but single-family starts also posted a healthy 1.9 percent increase.
As for building permits, this metric of future construction activity deteriorated in August, with weakness seen in both the single- and multi-family segments. Homebuilder optimism, though, remains elevated, and NAHB chairman Randy Noel in a press release yesterday said that “despite rising affordability concerns, builders continue to report firm demand for housing, especially as Millennials and other newcomers enter the market.” NAHB chief economist Robert Dietz added that “a growing economy and rising incomes combined with increasing household formations should boost demand for new single-family homes moving forward.”
Sources: Econoday, U.S. Census Bureau, NAHB, FRBSL
Post author: Charles Couch