Housing starts in June reached a seasonally adjusted annual rate of 1.174 million units, an increase of 9.8% compared to the revised May estimate of 1.069 million units and 26.6% above the June rate of 927,000 units, according to figures released by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
Most of the growth was in multifamily housing: Starts of new single-family homes in June reached an annual rate of about 685,000 units, up 0.9 % compared to the revised May figure of 691,000 units, while starts of multifamily units (five units or more per building) reached 476,000, up a whopping 28.6% from 370,000 units in May.
Permits in June were running at an annual rate of about 1.343 million, an increase of 7.4% compared to the revised May rate of 1.25 million and an increase of 30.0% compared to the June 2014 estimate of 1.033 million.
Permits for single-family homes in June were at a rate of about 687,000, an increase of 0.9% above the revised May figure of 681,000. Permits for multifamily units were at a rate of 621,000, up 16.1% from 535,000 in May.
About 972,000 new homes were completed in the 12 months leading up to June, according to the report. This is 6.7% below the revised May estimate of 1.042 million units but 22.0% above the June 2014 rate of 797,000 units.
About 647,000 new single-family homes were completed in the past 12 months leading up to June, a decrease of 0.3% compared to the revised May rate of 649,000 units. About 317,000 new multifamily units were completed in the same time period – down 17.9% compared to an annual rate of about 386,000 in May.
‘The multifamily gains [in June] are encouraging and show that the millennial generation continues to be drawn to the rental market,’ says Tom Woods, chairman of the National Association of Home Builders (NAHB), in a statement.
‘While builders are reporting overall confidence in the housing market, they continue to note difficulties accessing land and labor,’ adds David Crowe, chief economist for NAHB. ‘These headwinds appear to be affecting production gains in the single-family sector.’
Regionally, housing starts rose by 35.5% in the Northeast and 13.5% in the South, while the Midwest and West saw starts decrease by 0.7% and 6.0%, respectively.
Looking at permit activity, the South, West, Midwest and Northeast posted respective gains of 10.4%, 9.5%, 2.9% and 2.8%.