With the U.S. still experiencing a housing shortage due to construction halts from the COVID-19 pandemic, housing completions, and starts, should continue to push positive, as each showed true in April—and the need for housing remains everlasting.
According to data released by the U.S. Census Bureau, housing starts reached a seasonally adjusted rate of 1.360 million in April, which is 5.7% above the revised March estimate, and 0.6% below the April 2023 rate of 1.368 million. Additionally, single-family starts were down 0.4% below the revised March figure of 1.035 million. Mortgage rates still hover around 7%, weakening consumer confidence for the time being.
“Housing starts in April bounced back slightly after a large decline in the previous month,” noted National Association of REALTORS® (NAR) Chief Economist Lawrence Yun. “The latest monthly gain of 5.7%, following a 17% fall in March, was led by more activity in the South region. The total annualized rate of 1.36 million is insufficient overall. The country needs around 1.6 million or higher for a few years to truly bring about a balance in the housing sector.”
Pushing further, April completions were at a seasonally adjusted rate of 1.623 million, which is 8.6% above the revised estimate of 1.495 million, and 14.6% above the April 2023 rate—which sat at 1.416 million. Single-family housing completions were 15.4% above the revised March rate, at 1.092 million.
“Starts of new units in multifamily buildings continue to track far below last year. Single-family homebuilders have not only been dropping prices, but also have been building smaller homes designed to be more affordable to meet starter-home and mid-tier market demand,” said Bright MLS Chief Economist Dr. Lisa Sturtevant.
“The new housing sector has been an outsized share of the market for the past couple of years. Recently, the supply of existing homes has increased as more homeowners are listing their homes for sale,” she continued. “More supply should give buyers more choices late this spring and into the summer. Buyers who might have thought new construction was their only option might find more choices on the existing home side.”
Housing permits were also down 3% from March, falling to 1.440 million.
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