Housing starts gained in March as the multifamily sector picked up pace.
Figures released Tuesday by the HUD and Commerce Department show a 1.9% rise overall to a seasonally adjusted annual rate of 1.32 million starts; but this was due to a 14.4% jump for multifamily units (453,000) while single-family starts dropped 3.7% (867,000).
The reading for multifamily was the highest since December 2016, the National Home Builders Association reports.
“The modest decline in single-family starts in March is still in line with our solid builder confidence readings and is largely attributable to lingering winter weather that is causing production delays in certain areas of the country,” said NAHB Chief Economist Robert Dietz. “With ongoing job creation, wage increases and rising household formations, we can expect continued, gradual strengthening of the housing market in the coming months.”
The Midwest saw the largest rise in combined starts (22.4%) with the Northeast up slightly (0.8%). The South and West both posted declines, of 0.6% and 1.5% respectively.
There was a 19% rise for issuance of permits for multifamily units in March while the single-family sector declined 5.5%. Overall issuance was up 2.5% to a seasonally adjusted annual rate of 1.35 million units.
Outlook is strong says First American economist
There are two reasons to be optimistic that housing supply get some moderate relief in the months ahead, according to the chief economist of First American.
“The continued year-over-year growth in completions means more homes on the market in the short-term and the dramatic rise in construction employment this month indicates housing construction is likely to increase in the months ahead,” said Mark Fleming.
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