WASHINGTON (8/19/15)--Driven by single-family homes, housing construction starts ticked up by 0.2% in July to more than 1.2 million units, pushing year-over-year growth up to 10.1%, according to numbers released Tuesday by the Census Bureau (Economy.com Aug. 18).
Permits, however, headed in the opposite direction, falling by 16.3% overall and potentially foretelling a slow period for new construction in the coming months.
“The burst of housing starts this month masks the fact that single-family completions are down for the month and year, while single-family permits also fell for the month and are recording only weak-year-over-year growth,” said Andres Carbacho-Burgos, Moody’s analyst (Economy.com).
Still, housing starts had a particularly strong month in the single-family home segment, climbing 12.8% in July and 19% on an annual basis. But multifamily starts slipped by 17.1% during the month and fell 2.1% below their year-ago levels.
“Much of the decline for multifamily starts is simply the end of a second quarter spike for starts in the Northeast,” Carbacho-Burgos said.
Regionally for the month, starts jumped 20.1% in the Midwest and 7.7% in the South, but plummeted by 27.5% in the Northeast and 3.1% in the West. The drop in the West was driven by multifamily starts, as single-family starts climbed by 16.6%.
Housing completions came in at 987,000 nationwide, marking a 2.4% increase from June and a 14.6% increase on a year-over-year basis. Single-family completions dropped slightly in July, while multifamily completions surged by 9.7%.
“Though new-home sales are still trending upward over the past three years, they have fallen slightly in the past three months and this might well dampen homebuilder spirits as far as single-family construction is concerned,” Carbacho-Burgos said.