NAHB Reports Single-Family Housing Starts Rise in December; Builder Confidence Remains UpJanuary 20th, 2012 by DWM Magazine
Nationwide production of new single-family homes rose 4.4 percent to a seasonally adjusted annual rate of 470,000 units in December, according to newly released figures from the U.S. Commerce Department. This marked a third consecutive increase and the fastest pace of single-family housing starts since April of 2010, according to a release from the National Association of Homebuilders (NAHB). Meanwhile, the overall number of housing starts for the month declined 4.1 percent to a 657,000-unit rate due to a 20.4 percent dip on the more volatile multifamily side.
“Today’s report adds to the growing evidence that demand for new, single-family homes is finally starting to firm up in an increasing number of markets nationwide,” said Bob Nielsen, chairman of the NAHB and a home builder from Reno, Nev. “This emerging trend is allowing builders to put more crews back to work, and could be even stronger if not for the overly tight credit conditions that prevail for both builders and buyers, as well as the continuing foreclosure crisis and the challenges of obtaining accurate appraisal values on new homes. Policymakers should be doing everything possible to alleviate these problems and nurture the fledgling housing recovery in order to promote job and economic growth.”
Looking forward, NAHB is forecasting gains of approximately 17 percent in both single- and multifamily housing production in 2012. Combined single- and multifamily housing starts fell 4.1 percent to a 657,000-unit rate in December due to the multifamily side retreating 20.4 percent from a big gain in the previous month, to a seasonally adjusted annual rate of 187,000 units. However, for the year as a whole, overall housing production was pegged at 606,900 units, which was 3.4 percent better than the overall number of starts in 2010.
In related news, the NAHB also reported that builder confidence in the market for newly built, single-family homes continued to climb for a fourth consecutive month in January, rising four points to 25 on the NAHB/Wells Fargo Housing Market Index (HMI). This is the highest level the index has attained since June of 2007, the release stated.
Each of the HMI’s three component indexes registered a fourth consecutive month of improvement in January. The component gauging current sales conditions rose three points to 25, which was its highest point since June of 2007. The component gauging sales expectations in the next six months also rose three points, to 29 — its highest point since September 2009. And the component gauging traffic of prospective buyers rose three points to 21, its highest point since June of 2007.