Single-Family Starts Drop in December, But Total Was Up
As the nation basked under unseasonably warm winter weather, housing starts rose 4.5% in December to a seasonally adjusted annual rate of 1.642 million units, according to a Commerce Department report released on Jan. 18. The upswing was entirely in the multifamily sector, however, and single-family construction turned downward for the month as builders continued to concentrate on reducing their inventories.
Single-family housing starts dropped 4.1% to a seasonally adjusted annual rate of 1.230 million units in December, which was 24.7% below their pace a year earlier.
“The improvement in market conditions, coupled with the drop in single-family housing starts, indicates that builders are working to control their inventories and positioning themselves for the upcoming spring buying season,” said NAHB President David Pressly.
“With improving affordability measures, strengthening consumer assessments of home buying conditions and an upswing in applications for mortgages to buy homes, builders are starting to see that the worst is behind them,” said NAHB Chief Economist David Seiders.
December’s housing starts were up 25.6% in the Northeast, 12.4% in the West and 1.8% in the Midwest. Production declined 2.0% in the South. Regionally, construction was substantially below its pace of a year earlier, with the exception of the Northeast, which was building homes at a faster clip.
Housing starts for 2006 totaled an estimated 1.801 million units, the Commerce Department reported, which was 12.9% below the 2.068 million homes started in 2005.
The number of building permits issued rose 5.5% in December to a yearly rate of 1.596 million, but that was 24.3% below a year ago. Single-family permit issuance rose 1.2% to a pace of 1.164 million units, 29.1% below a year earlier, while multifamily permits were up 19.0%, to 432,000 units, which was 7.1% below the December 2005 pace.
Want to Know the Long-Term Forecast Through 2015?
Find out in HousingEconomics.com’s Long-Term Forecast.
HousingEconomics.com includes downloadable Excel tables featuring the housing starts forecast, GDP, demographics and more.
To learn more, visit www.housingeconomics.com.
NAHB Kit Gives Builders Back-to-Basics Tips in Changing Market
With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment.
To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar.
For assistance, call the NAHB Member Service Center at 800-368-5242.