US Housing Starts Rose 12.2% as Building Permits Fell 10.0% in August

US housing starts increased 12.2% month-over-month in August, a much higher-than-expected 1.575 million units v consensus 1.448 million. The rise was fueled by an outsized 28% increase in multi-unit starts. Building permits however were down 10.0% month-over-month to a seasonally adjusted annual rate of 1.517 million (consensus 1.610 million), paced by a 17.9% decline in multi-unit permits and a 3.5% decline in single-family units.  Weakness in the permits data suggests the strength in starts is not sustainable.

The move suggests disruption and demographic influences.

United States Housing Starts August 2022

The keynote from the report was the 28% increase in multi-unit starts. Single-family starts were up 3.4%. Starts rose month-over-month in three of the four geographic regions.

  • US Housing Starts Aug: 1575K (est 1450K; prev 1446K)
  • Housing Starts (M/M) Aug: 12.2% (est 0.3%; prev -9.6%)
  • Housing starts were revised lower to 1.404M in July from 1.446M previously reported
  • Housing starts are 0.1% below the August 2021 rate of 1.576M.
  • Single-family housing starts 935K +3.4% vs. July’s 904K
  • Multi-unit starts rose 28% 
  • The change in single unit starts by region: Northeast (-14.3%); Midwest (+20.8%); South (+2.1%); and West (+4.2%).
United States Housing Starts
United States Housing Starts MoM

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 is seen slowing in the coming months, amid rising mortgage rates, supply constraints and higher house prices. Rates are now sharply higher (over 6%).

United States Building Permits August 2022

  • US Building Permits Aug: 1517K (est 1604K; prevR 1685K)
  • US Building Permits (M/M) Aug: -10.0% (est -4.8%; prevR -0.6%)
  • 14.4% below the August 2021 rate of 1.772M
  • Single-family building permits 899K which is -3.5% vs. July.
  • Multi-unit permits a 17.9% decline
  • The change in single unit permits by region: Northeast (-8.2%); Midwest (-9.0%); South (-3.6%); and West (+1.6%).
United States Building Permits
United States Building Permits MoM

Housing Completions

  • Privately‐owned housing completions in August were at a seasonally adjusted annual rate of 1,342,000. This is 5.4 percent (±12.1 percent) * below the revised July estimate of 1,419,000 but is 3.1 percent (±10.5 percent) * above the August 2021 rate of 1,302,000.
  • Single‐family housing completions in August were at a rate of 1,017,000; this is 0.4 percent (±12.8 percent) * above the revised July rate of 1,013,000. The August rate for units in buildings with five units or more was 318,000

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 

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