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US housing starts post healthy gains in August
September 18, 2019 By National Association of Home Builders
Led by a surge in multifamily production, total housing starts rose 12.3 per cent in August to a seasonally adjusted annual rate of 1.36 million units from an upwardly revised reading in July, according to a report from the U.S. Housing and Urban Development and Commerce Department. This is the highest level since May 2007.
The August reading of 1.36 million starts is the number of housing units builders would begin if they kept this pace for the next 12 months. Within this overall number, single-family starts increased 4.4 per cent to 919,000 units. The multifamily sector, which includes apartment buildings and condos, jumped 32.8 per cent to a 445,000 pace.
“This solid report is in line with our latest survey on builder sentiment,” said Greg Ugalde, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Torrington, Conn. “However, builders continue to wrestle with affordability concerns stemming from excessive regulations and other supply-side challenges.”
“Housing has been on an upswing in recent months as the pace of permits and starts has been rising since spring,” NAHB Chief Economist Robert Dietz. “While these are positive developments, single-family starts are down 2.7 per cent year-to-date as the catch up process continues.”
On a regional and year-to-date basis, combined single-family and multifamily starts in August rose 4.4 per cent in the South. Starts declined 1.8 per cent in Northeast, 5.6 per cent in the Midwest and 11.3 per cent in the West.
Overall permits, which are a harbinger of future housing production, increased 7.7 per cent to a 1.42 million unit annualized rate in August. Single-family permits increased 4.5 per cent to a 866,000 rate while multifamily permits rose 13.3 per cent to a 553,000 pace.
Looking at regional permit data on a year-to-date basis, permits rose 5.7 per cent in the Northeast and 1.6 per cent in the South. Permits fell 6.9 per cent in the Midwest and 5.6 per cent in the West.
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