The Official Online Weekly Newspaper of NAHB
Single-family housing starts were virtually unchanged from the previous month at a seasonally adjusted annual rate of 454,000 units in June, according to figures released by the U.S. Commerce Department on July 20.
Meanwhile, a hefty decline in more volatile multifamily starts weighed down the overall housing production number, which fell 5% to a 549,000-unit rate.
"As our most recent member surveys have indicated, builders remain very cautious in light of the sluggish pace of the economic recovery and the hesitancy they are seeing among potential home buyers," noted NAHB Chairman Bob Jones. "However, the June report is actually somewhat encouraging, because it indicates that single-family production is stabilizing following an expected lull that occurred with the end of the home buyer tax credit program."
"The government's figures suggest that single-family housing production may be finding a bottom following the tax credits," agreed NAHB Vice President and Senior Economist Bernard Markstein.
"Over the next several months, we expect to see some improvement in both housing starts and sales activity as buyers come forward to take advantage of the very attractive home prices, historically low mortgage rates and excellent selection that characterize today's new-home marketplace,” Markstein said. “However, builders continue to confront significant challenges in obtaining financing for viable new projects, and this problem remains a formidable obstacle to economic growth."
Almost all of the 5% decline in June housing production was on the multifamily side, which slid 21.5% to a seasonally adjusted annual rate of 95,000 units.
Single-family starts, on the other hand, hardly budged, declining a scant 0.7% to 454,000 units.
All four regions of the country saw a slowdown in overall housing production in June, with declines of 11.3% in the Northeast, 6.9% in the Midwest, 2.4% in the South and 5.9% in the West.
Meanwhile, nationwide permit issuance, an indicator of future building activity, rose 2.1% to a seasonally adjusted annual rate of 586,000 units in June.
Single-family permits fell 3.4% to 421,000 units for the month, due entirely to a drop-off in the South, with every other region holding steady or improving on the single-family side.
Multifamily permits rose 19.6% to a seasonally adjusted annual rate of 165,000 units in June.
Combined single-family and multifamily permit issuance in June was up 32.3% in the Northeast, down 10.8% in the Midwest, down 3.1% in the South and up 9.7% in the West.