Multifamily leads to decline in housing starts

by Steve Randall17 May 2017
There were fewer housing starts nationwide in April, with the multifamily sector dragging the seasonally-adjusted annual rate down 2.6% to 1.17 million.

Data from the HUD and the Commerce Department shows that the multifamily sector was down 9.2% to a SAAR of 337,000 units while there was little change in single-family home starts at 835,000, a 0.4% rise.

“While we saw a little pause in market growth this month, single-family production is still up 7 percent since the start of 2017,” said NAHB Chief Economist Robert Dietz. “The April report falls in line with our forecast for continued, gradual strengthening of the single-family sector throughout the year.”

The Midwest led the rise in new home starts with a 19.4% increase and the West was up 9.1%. Meanwhile, there was a 29.2% drop in the Northeast while the South slipped 3.4%.

There was also a nationwide drop in the issuance of building permits with a SAAR of 1.23 million units, down 2.5%. It was single-family intentions which were lower (by 6.2% to 789,000) while multifamily gained 1.4% to 440,000.

Again it was the West (8.7%) and Midwest (1%) that gained and the Northeast (-10.3%) and South (-7.4%) that declined.

Commenting on the figures and acknowledging that builders need to be mindful of rising construction costs, the chairman of the National Association of Home Builders, Granger MacDonald, says things are looking positive.

“Despite this minor pull back, builders are optimistic about market conditions and expect more consumer activity in the months ahead,” MacDonald said.

More market update:

Poll

Should CFPB have more supervision over credit agencies?