NAHB: Housing Construction Increases 4.1% in October

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Permits to build new homes increased 4.1% in October to a level of 1.15 million per year, according to the National Association of Home Builders. Both single-family and multifamily levels increased, by 2.4% and 6.8%, respectively. Year over year, total permits were up 11.9%, with single-family 8.6% higher and multifamily increasing 17.2% as the housing market continues its modest pace of recovery.

NAHB reports that October housing starts were down, primarily due to a decrease in multifamily activity. Multifamily starts were up significantly in September, so the downward adjustment was expected. October multifamily starts, at 338,000, were the lowest since March 2015 but rose 10.4% compared to last year.

Single-family starts were down 2.4% to 722,000 on an annual basis. Three of the four census regions reported slight increases, while single-family starts in the South fell 6.9%. The drop appears to be due to especially stormy weather throughout the southern coast in October, notes NAHB. Year-to-date single-family totals were up across all regions, like single-family permits, suggesting that the slight October drop is temporary.

The steady increase in residential starts in 2015 has produced a steady rise in the number of homes under construction, although carrying them through to completion slowed as labor shortages, especially for finish carpenters, stalled the ability to get finish work done, the association comments. NAHB’s forecast calls for continued modest growth this year and some slight acceleration in single-family construction in 2016 as the economy grows, jobs are added, and mortgage rates remain relatively low.

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