Recently released data from the U.S. Department of Housing and Urban Development and the Commerce Department reveals overall housing starts rose to 3.2 percent in November, bringing the seasonally adjusted annual rate (according to the National Association of Home Builders) to 1.26 million units. Year-to-date starts are 5.1 percent higher than this period last year. A closer look at the data shows that the multifamily segment is currently propping up slower starts among single-family residences. Contained in the overall number, single-family starts fell 4.6 percent to 824,000, dropping for the third straight month, while multifamily starts rose 22.4 percent to 432,000.

“The decline in single-family production over the last few months makes sense given the drop in our builder confidence index,” says NAHB chairman Randy Noel. “Builders are cautious to add inventory as housing affordability concerns are causing consumers to pause on making a home purchase.”

Overall permits rose 5 percent in November to 1.39 million. Single-family permits grew 0.1 percent to 848,000 units, while multifamily permits rose 14.8 percent to 480,000.

“Favorable demographics support healthy housing demand, so it is frustrating that the housing affordability crisis is preventing many consumers from achieving their goals of buying a home,” says NAHB chief economist Robert Dietz. “While homeownership has increased over the last nine quarters, we can expect that upward momentum to stop due to rising home costs. Because housing leads the economy, we need to stabilize residential market conditions.”

Regionally, on a year-to-date basis, overall housing starts rose 11 percent in the West and 5.3 percent in the South. Starts fell 0.8 percent in the Northeast and 1.9 percent in the Midwest.

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