US housing starts in April increased 2.2% month-over-month in April to a seasonally adjusted annual rate of 1.401 million (consensus 1.405 million) from a downwardly revised 1.371 million (from 1.420 million) in March. Single-family starts were up 1.6% month-over-month, because of a strong 59.5% increase in the West; single-family starts declined in all other regions. Building permits declined 1.5% month-over-month to 1.416 million consensus 1.438 million) from an upwardly revised 1.437 million (from 1.413 million) in March.
Affordability is the major issue overhanging; mortgage demand hovers near its lowest level since 1997. Single-unit starts are down 28.1% year-over-year and single-family permits being down 21.2% year-over-year.
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 April 2023
- US Total housing starts in April increased 2.2% month-over-month in April to a seasonally adjusted annual rate of 1.401 million (consensus 1.405 million) from a downwardly revised 1.371 million (from 1.420 million) in March.
- Single-family starts were up 1.6% month-over-month,
- The rise was because of a strong 59.5% increase in the West; single-family starts declined in all other regions.
- Single-unit starts down 28.1% year-over-year
- Multi-units starts with five units or more was 542,000.
- Starts surged in the West (34.6% to 315K) and the Midwest (32.6% to 171K) but fell in the Northeast (-23.4% to 131K) and the South (-6.3% to 784K)
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 April 2023
- US Building Permits declined 1.5% month-over-month to 1.416 million (consensus 1.438 million) from an upwardly revised 1.437 million (from 1.413 million) in March.
- Single-unit permits rose 3.1% month-over-month, led by gains in all regions.
- Single-family permits down 21.1% year-over-year.
- The weakness in permits was driven by a 9.7% decline in permits for 5 units or more.
- Permits were down in the Northeast (-23.6 percent to 113 thousand) and Midwest (-15.2 percent to 173 thousand), but were up in the South (4.3 percent to 801 thousand) and West (3.8 percent to 329 thousand).
Housing Completions
- Privately‐owned housing completions in April were at a seasonally adjusted annual rate of 1,375,000. This is 10.4 percent (±9.9 percent) below the revised March estimate of 1,534,000 but is 1.0 percent (±16.4 percent)* above the April 2022 rate of 1,361,000.
- Single‐family housing completions in April were at a rate of 971,000; this is 6.5 percent (±11.0 percent) below the revised March rate of 1,039,000.
- The April rate for units in buildings with five units or more was 400,000.
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