Housing Starts Dipped 3.0% In August, But Permits Were Up

Posted by Patrick Barnard on September 18, 2015 No Comments
Categories : Residential Mortgage

Housing starts in August were at a seasonally adjusted annual rate of about 1.13 million, a decrease of 3.0% compared to the revised July estimate of 1.16 million but an increase of 16.6% compared to the August 2014 rate of 966,000, according to estimates released by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau.

Starts of single-family homes were at an annual rate of 739,000 units, a decrease of 3.0% compared to the revised July figure of 762,000 units.

Starts of multi-family units (five or more residences per building) in August reached an annual rate of about 381,000 units, down 2.3% compared to 390,000 in July.

Building permits in August reached a seasonally adjusted annual rate of 1.17 million, an increase of 3.5% compared to the revised July rate of 1.13 million and an increase of 12.5% compared to the August 2014 estimate of 1.04 million.

Permits for single-family homes were at a rate of 699,000, an increase of 2.8% compared to the revised July figure of 680,000.

Permits for multifamily units were at a rate of 440,000, an increase of 4.3% compared to 422,000 in July.

Housing completions were at an adjusted annual rate of 935,000, a drop of 6.1% compared to the revised July estimate of 996,000 but 3.3% above the August 2014 rate of 905,000.

Single-family housing completions were at a rate of 627,000, an increase of 1.6% compared to the revised July rate of 636,000. Completion of multi-family units reached a rate of 283,000.

In a statement, Tom Woods, chairman of the National Association of Home Builders (NAHB), says the permit growth in August indicates that builders are gaining confidence that buyers are returning to the market.

‘However, builders are reporting concerns with lots and labor availability, which could have contributed to this month's production dip,’ he says.

‘A slight one-month decline is not unusual as the housing market moves forward at a slow and steady pace,’ adds David Crowe, chief economist for NAHB. ‘However, encouraging permit data, year-over-year increases in single and multifamily production, and rising builder confidence all bode well for a continuing, gradual recovery throughout the rest of the year.’

Regionally, the Northeast, Midwest and West saw housing starts decrease 33.7%, 9.8% and 1.1%, respectively. Meanwhile, the South saw starts increase 7.1% compared to July.

In terms of permits, the Midwest, South and West saw gains of 2.9%, 2.4% and 9.6%, while the Northeast saw permits fall 4.4%.

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