The U.S. Department of Housing and Urban Development and the Commerce Department released new data showing total housing starts rising 1.5 percent in October. This brings the seasonally adjusted annual rate to 1.23 million units. Compared to this time last year, new housing starts are up 5.6 percent.

Contained within the overall number, single family starts are down 1.8 percent to 865,000 units, while multifamily starts are up 10.3 percent to 363,000 units.

“This month’s decrease in single-family starts isn’t a surprise given the drop in our builder confidence index,” says NAHB chairman Randy Noel. “Builders are showing caution as mounting housing affordability concerns are forcing some consumers to delay making a home purchase.”

Overall permits dropped 0.6 percent to 1.26 million in October. Single-family permits fell 0.6 percent to 849,000 units, with multifamily permits dropping 0.5 percent to 414,000 units.

“Single-family starts were strong at the beginning of the year, but weakened this summer and have remained soft,” says NAHB chief economist Robert Dietz. “Despite this softness, 2018 construction volume is set to be the best since the downturn. A growing economy and positive demographic tailwinds are supporting housing demand as interest rates rise. However, policymakers should take note of the November decline in builder confidence as a sign that housing affordability conditions will weigh on the housing market going forward.”

Leave a Reply

Your email address will not be published. Required fields are marked *