Single-family and multifamily housing starts accelerated in November, due to increasing demand for new construction. Housing starts increased 11.8% to a seasonally adjusted annual rate of 1.68 million units, according to the latest data from the Commerce Department.
The November reading of 1.68 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months.
Key findings:
- Combined single-family and multifamily starts are 24.4% higher in the Northeast, 9.6% higher in the Midwest, 15.4% higher in the South and 19.4% higher in the West year-to-date from January to November 2021.
- Overall permits increased 3.6% to a 1.71 million unit annualized rate in November.
- Single-family permits increased 2.7% to a 1.10 million unit rate.
- Multifamily permits increased 5.2% to an annualized 609,000 pace.
- Permits are 13.6% higher in the Northeast, 16.3% higher in the Midwest, 19.3% higher in the South and 22.4% higher in the West.
The takeaway:
“Mirroring gains in the HMI reading of builder sentiment, single-family housing starts accelerated near the end of 2021 and are up 15.2% year-to-date as demand for new construction remains strong due to a lean inventory of resale housing,” said Chuck Fowke, chairman of the National Association of Home Builders (NAHB) in a statement. “Policymakers need to help alleviate ongoing building material supply chain bottlenecks that are preventing builders from keeping up with buyer demand.”
“Breaking an eight-year trend, in recent months there have been more single-family homes under construction than multifamily units,” said NAHB Chief Economist Robert Dietz in a statement. “Moreover, despite some cooling earlier this year, the continued strength of single-family construction in 2021 means there are now 28% more single-family homes under construction than a year ago. These gains mean single-family completions will increase in 2022, bringing more inventory to market despite a 19% year-over-year rise in construction material costs and longer construction times.”
