Despite a more favorable outlook on the housing industry that has come along with a sharp decrease in mortgage rates over the last several weeks, housing starts fell last month, after a three-month uptick, the government reported Thursday.
The latest data from the Commerce Department via the U.S. Census Bureau shows new construction in the U.S. fell 4.3% in December to an annual rate of 1.46 million units. Single-family starts fell 8.6% to a rate of 1.02 million, but were up 7.6% over December 2022. The December rate for units in buildings with five units or more was 417,000.
- Building permits increased 1.9% to a seasonally adjusted annual rate of 1,495,000 over the revised November rate of 1,467,000
- Overall permits increased 1.6% above the December 2022 rate of 1,409,000 million
- Single-family permits increased 1.7% at a rate of 994,000. An estimated 1,469,800 housing units were authorized by building permits in 2023 for single-family permits, which is down 11.7% year-to-date.
- Authorizations of units in buildings with five units or more were at a rate of 449,000 in December.
Industry take:
“While monthly housing starts data can oscillate a lot, the general trend we are looking for is an increase in starts, particularly for single-family homes,” said CoreLogic’s Chief Economist Dr. Selma Hepp. “Increase in building permits over the course of 2023 and generally more positive housing outlook for 2024 due to lower mortgage rates are all positive signs that homebuilders are cautiously optimistic about building new homes.”
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