Housing permits rise in October
October housing starts slipped 0.7% to a seasonally adjusted rate of 1.52 million from the revised September rate of 1.53 million, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development reported this morning.
The latest report is 0.4% above the October 2020 rate of 1.514 million, however.
Single-family starts fell 3.9% to 1.039 million from the revised September rate of 1.081 million. The multifamily sector, including apartments and condos, increased 7.1% to an annualized 481,000 pace.
But housing permits increased 4% in October to a seasonally adjusted annual rate of 1.650 million from the revised September rate of 1.586 million. The rate for October is also 3.4% above the rate of 1.595 million for October 2020.
Single‐family permits increased 2.7% to a seasonally adjusted rate of 1.069 million from the revised September figure of 1.041 million. Multifamily permits increased 6.6% to an annualized 581,000 pace.
Due to supply-chain effects, there are 152,000 single-family units authorized but have yet to start construction— up 43.4% from a year ago.
“The rising count of homes permitted but that have not yet started construction is a stark reminder to policymakers to fix the supply chain so that builders can access a steady source of lumber and other building materials to keep projects moving forward,” said NAHB Chairman Chuck Fowke.
Here’s how housing starts and permits performed regionally compared to the prior month:
- In the Northeast, total housing starts slipped 0.8% as single-family starts declined 15.2%. Overall permits climbed 4.8% while single-family permits shot up by 16.4%.
- In the Midwest, total housing starts increased 5.6% as single-family starts decreased 7.5%. Total permits increased 8.3% while single-family permits were up 4.8%.
- In the South, total starts slipped 1% as single-family starts dipped 1.8%. Total permits edged up by 0.9% as single-family permits saw a 2.3% increase.
- In the West, total starts were down 3.3% as single-family starts fell 4.2%. Combined permits ascended 8.1% as single-family permits decreased 0.4%.
This report follows the news that home builder sentiment in the market for newly-built single-family homes moved three points higher to 83 in November, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI).
The increase in builder confidence arrives as the industry continues to battle a shortage of lots and labor in addition to supply chain issues.
“Single-family permit data has been roughly flat on a seasonally adjusted basis since June due to higher development and construction costs,” said NAHB Chief Economist Robert Dietz. “Demand remains solid but housing affordability is likely to decline in 2022 with rising interest rates.”
