Continued Growth in Single Family Starts Keeps Home Building on Track
Updated: Jan. 18, 2023Consistent demand for housing has led to one of the busiest periods for home building in years. And it doesn't look like things are slowing down any time soon.
According to the latest data from the U.S. Census Bureau, single-family housing starts increased 8.5 percent month-over-month in September. Multi-family starts performed much less favorably, dropping 16.3 percent month-over-month. Overall, housing production increased 1.9 percent to a seasonally adjusted annual rate of 1.42 million units.
“The housing market remains a bright spot in the U.S. economy, and this is reflected in today’s positive housing starts report,” said Chuck Fowke, chairman of the National Association of Home Builders. “Builder confidence is at an all-time high as buyer traffic is strong — another sign that housing is helping to lift the economy.”
Single-family home building is surging thanks to high levels of demand for housing that grew over the summer and maintained momentum into the fall. Despite a slight dip new homes sales in September, demand remains high and presents a great opportunity for home builders. But it also presenting a few challenges.
“Home sales have exceeded for-sale home construction recently, which means additional home building in the near term,” said Robert Dietz, chief economist for the NAHB. “Demand is being supported by low interest rates, a suburban shift in demand and demographic tailwinds.
“However, headwinds due to limited building material availability is slowing some construction activity despite strong demand, with authorized but not started single-family homes up 22.4 percent compared to a year ago.”
Such high levels of home building activity have caused select problems in the industry, including disruptions of the supply chain and increased prices of building materials. Despite these issues, home builders remain optimistic heading into the new year, encouraged by a seemingly unflagging demand for housing.
