US Housing Starts Hit Nine Month High, up 1.4% as Building Permits Rise 9.1% in December

US housing starts rose in December 1.4% to a seasonally adjusted annualized rate of 1.702 mln units versus a consensus 1.650 mln from a revised 1.678 mln units in November (from 1.679 mln). Housing demand remains strong although high prices for building materials, lumber, supply constraints and labor shortages. Building permits rose 9.1% to a seasonally adjusted 1.873 mln in December up from a consensus 1.702 mln and a revised 1.717 mln in November (from 1.712 mln).

The move suggests disruption and demographic influences.

United States Housing Completions December 2021

Privately‐owned housing completions in December were at a seasonally adjusted annual rate of 1,295,000. This is 8.7 percent (±14.5 percent) * below the revised November estimate of 1,418,000 and is 6.6 percent (±10.4 percent) * below the December 2020 rate of 1,386,000.

  • Single‐family housing completions in December were at a rate of 990,000; this is 3.9 percent (±13.3 percent) * above the revised November rate of 953,000.
  • The December rate for units in buildings with five units or more was 299,000.
  • An estimated 1,337,800 housing units were completed in 2021. This is 4.0 percent (±3.2 percent) * above the 2020 figure of1,286,900.

United States Housing Starts December 2021

  • Housing starts in the US increased 1.4% mom to a seasonally adjusted annualized rate of 1.702 million in December of 2021, the highest since March and beating market forecast of 1.65 million
  • Starts for units in buildings with five units or more jumped 13.7% to 0.524 million
  • Rate for single-family housing starts declined 2.3% to 1.172 million.
  • Starts surged in the Midwest (36.5% to 0.288 million) and Northeast (20.2% to 0.137 million)
  • Starts fell in the South (-1.9% to 0.915 million) and the West (-13.8% to 0.362 million).
United States Housing Starts

The housing market has been supported by low interest rates and increasing demand from people moving away from big cities due to the coronavirus crisis, but the momentum could slow as rising lumber prices amid supply constraints could limit production and ease a shortage of homes. Homebuilding activity is seen slowing in the coming months, amid rising mortgage rates, supply constraints and higher house prices.

United States Building Permits December 2021

  • Building permits surged 9.1 percent from a month earlier to a seasonally adjusted annual rate of 1.873 million in December 2021, the highest level since January well above market expectations of 1.701 million, supported by an acute shortage of homes available for sale.
  • The US government nearly doubled duties on imported Canadian softwood lumber in November.
  • The volatile multi-segment jumped 21.9 percent to a rate of 745 thousand in December and single-family authorizations advanced 2.0 percent to a rate of 1.128 million.
  • Building permits in 2021 were estimated at 1.725 million, up 17.2 percent from 1.471 million in 2020.
United States Building Permits

The big question is after the lockdown eases and the economy reopens how much further can housing starts go with the massive disruption and divergence with unemployment and wealth creation and erosion demographics.

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 

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