US Housing Starts Rise: April 2019

US Housing Starts Rise: April 2019

According to estimates from the U.S. Housing and Urban Development and Commerce Department released Thursday, single-family and multifamily starts in the US improved in April, consistent with the recent stabilization of the NAHB/Wells Fargo Housing Market Index (HMI). Single-family starts increased +6.2% to an 854,000 seasonally adjusted annual pace in April. Total multifamily starts increased +4.7% to a 381,000 annualized rate.

  • U.S. homebuilding increased more than expected in April and activity in the prior month was stronger than initially thought.
  • The data suggested declining mortgage rates were starting to provide some support to the struggling housing market.
  • Housing starts rose +5.7% to 1.235 million units last month, driven by gains in the construction of both single- and multi-family housing units, the Commerce Department said. 
  • Groundbreaking was also likely boosted by drier weather in the Midwest.

Single-family homebuilding, which accounts for the largest share of the housing market, increased +6.2% to a rate of 854,000 units in April. Single-family homebuilding surged in the Midwest, which had suffered flooding in prior months. Single-family starts also rose in the Northeast and West, but fell in the South, where the bulk of homebuilding occurs. Permits to build single-family homes dropped 4.2% to a rate of 782,000 units in April.

The US housing market has been mired in a soft patch since last year. Investment in homebuilding contracted at a -2.8% annualized rate in the first quarter, the fifth straight quarterly decline.
Explains the US National Association of Home Builders: Recent construction softness is clear in the current estimates of housing units under production. As of April 2019, there were 525,000 single-family homes under construction. While this is +1.7% higher than a year ago, it is down from the 545,00 peak count from January 2019.
Similarly, there are currently 596,000 apartments under construction, which is more than -2% lower than a year ago and down from the peak count of 623,000 in February 2017.

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