US housing starts in March declined 0.8% month to a seasonally adjusted annual rate of 1.420 million (consensus 1.407 million). The fall was due to a decline in multi-unit starts. Single-unit starts were up 2.7% month-over-month to 861,000. Building permits declined 8.8% month-over-month, driven by a 24.3% decline in permits for 5 units or more, whereas single-family permits increased 4.1% month-over-month to 818,000.
Affordability is the major issue overhanging; mortgage demand hovers near its lowest level since 1997.
The move suggests disruption and demographic influences.
The key indicator from the report is the growth seen in single-family starts and single-family permits, a leading indicator which is needed given the limited supply of existing homes for sale.
United States Housing Starts March 2023
- US Total housing starts in March declined 0.8% month to a seasonally adjusted annual rate of 1.420 million (consensus 1.407 million). Below the revised February estimate of 1,432,000 and is 17.2 percent (±9.1 percent) below the March 2022 rate of 1,716,000.
- The fall was due to a decline in multi-unit starts.
- Single-unit starts were up 2.7% month-over-month to 861,000. (±14.4 percent)* above the revised February figure of 838,000.
- Multi-units starts with five units or more was 542,000.
- Starts fell in the Midwest (-23.6% to 133K), the West (-28.1% to 258K), and soared in the South (6.8% to 848K) and in the Northeast (72.4% to 181K).
The housing market had been supported by low interest rates and increasing demand from people moving away from big cities due to the coronavirus crisis, but the momentum slowed with rising inputs amid supply constraints could limit production to ease a shortage of homes. Homebuilding activity has seen an adverse impact from sharply higher mortgage rates on buyer demand and builder sentiment. Further to rising mortgage rates, headwinds come from supply constraints and higher house prices. Rates are now sharply higher (over 6%).
United States Building Permits March 2023
- US Building Permits Building permits for privately‐owned housing units in March were at a seasonally adjusted annual rate of 1,413,000. This is 8.8 percent below the revised February rate of 1,550,000 and is 24.8 percent below the March 2022 rate of 1,879,000.
- Single‐family authorizations in March were at a rate of 818,000; this is 4.1 percent above the revised February figure of 786,000.
- Authorizations of units in buildings with five units or more were at a rate of 543,000 in March.
- Permits were up only in the Northeast (25.2 percent to 144 thousand) but were down in the South (-11.8 percent to 761 thousand), West (-16.5 percent to 314 thousand) and Midwest (-1.0 percent to 194 thousand).
Housing Completions
- Privately‐owned housing completions in March were at a seasonally adjusted annual rate of 1,542,000. This is 0.6 percent (±13.3 percent)* below the revised February estimate of 1,552,000, but is 12.9 percent (±18.6 percent)* above the March 2022 rate of 1,366,000.
- Single‐family housing completions in March were at a rate of 1,050,000; this is 2.4 percent (±12.4 percent)* above the revised February rate of 1,025,000.
- The March rate for units in buildings with five units or more was 484,000
Notice of methodology change: Beginning with the January 2022 New Residential Construction release on February 17, 2022, the monthly Building Permits Survey design will change from a representative sample to a cut‐off sample. This change will allow complete local and county data on new housing units authorized by permits to be published on a monthly basis going forward. For additional details on this change and the impact on New Residential Construction, see our FAQ document.
Source: US Census
From The TradersCommunity News Desk