US Residential Property Values: September 2015

The typical size of newly built single-family homes was effectively unchanged from 2Q to 3Qf 2015, posting a small quarterly decline. The current data is consistent with the general trend of flat growth for the size of typical newly-built homes, a pattern that took hold during 2014. As first-time buyers return to the market, typical home size is expected to trend somewhat lower.

According to third quarter 2015 data from the Census Quarterly Starts and Completions by Purpose and Design and NAHB analysis, median single-family square floor area fell from 2,478 in 2Q to 2,445 square feet. Average (mean) square footage for new single-family homes fell from 2,704 to 2,653 for 3Q.

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On a less volatile one-year moving average, the recent trend of leveling home size can be see on the graph above, although current sizes remain elevated. Since cycle lows and on a one-year moving average basis, the average size of new single-family homes has increased 13 per cent to 2,693 square feet, while the median size has increased 17 per cent to 2,472 square feet.

US Housing Starts: October 2015

New-home building in the US declined more than projected in October, led by a slump in apartment construction and showing fitful progress in residential real estate.
Residential starts dropped 11 per cent to a 1.06 million annualized rate, the slowest since March, from a revised 1.19 million pace the prior month, a Commerce Department report showed Wednesday.
The decrease in starts last month was primarily due to a 25.1 per cent slump in work on multifamily homes, the biggest since August 2014. Data on these projects, which have led housing starts in recent years, tend to be volatile.

Construction of single-family houses fell 2.4 per cent a 722,000 rate. The decline was due entirely to a decrease in the South as starts of detached homes picked up in the rest of the country. Two of four regions showed decreases in total starts last month, led by an 18.6 per cent slump in the South, the report showed. Construction fell 16.2 per cent in the West.

Building permits increased 4.1 per cent to a 1.15 million annualized rate. They were led by an increase in applications for single-family homes, which climbed to a 711,000 pace, the strongest since December 2007.