October Housing Starts Jump to Highest Level Since 2007
Multifamily Skyrockets 74.5 Percent; Single-Family Up 10.7 Percent
Housing starts in October surged to its highest pace since August 2007 on a year-over-year basis. The multifamily sector skyrocketed, while single-family put up solid numbers, albeit not as strong as the former.
Combined private sector housing starts, at a seasonally adjusted annual rate of 1,323,000 units, were 25.5 percent above the revised September estimate of 1,054,000 units, according to the Census Bureau's latest residential construction report.
More than half of those total starts came from the single-family sector with 869,000 units, or 10.7 percent above the revised September figure of 785,000 units. On a percentage basis, however, multifamily made a huge jump in October to 445,000 units, a climb of 74.5 percent.
Combined starts are 23.3 percent higher versus the October 2015 rate of 1,073,000 units, while single-family is up 23.3 percent, and multifamily has climbed 28.2 percent, both on a year-over-year basis.
Housing starts reached their highest level in nearly a decade (since August 2007) in October on the strength of a rebound in multifamily construction after plummeting in September, Construction Dive said. In the Census Bureau's residential construction report for September, combined housing starts fell 9 percent and multifamily nosedived 38.9 percent, while single-family rose 8.1 percent, all compared to August.
October's figure beat analyst expectations of 1.17 million considerably, according to MarketWatch, which noted that the month's drastic swing is due in part to typical volatility in economic indicators, Construction Dive said.
By region, in single-family starts, the West (+21.2 percent) had the highest percentage, while the South (454,000 units) led in terms of numbers, according to Census Bureau data. In multifamily, the Midwest (+166.7 percent) was by far the biggest gainer, while the South (194,000 units) led all regions solely in terms of numbers, according to the National Association of Home Builders and the Wells Fargo Economics Group.
Building permits in October were at a seasonally adjusted annual rate of 1,229,000 units. This is 0.3 percent above the revised September rate of 1,225,000 units, and 4.6 percent higher than the October 2015 estimate of 1,175,000.
Permit data is an indicator of future building activity.
Single-family permits were at a rate of 762,000, or 2.7 percent above the revised September figure of 742,000. Single-family has climbed 5.1 percent year-over-year. Multifamily, at 439,000 units, dropped 1.8 percent month-over-month, but has gained 5.8 percent compared to October 2015.
Completions in October were at a seasonally adjusted annual rate of 1,055,000, or 5.5 percent above the revised September estimate of 1,000,000, and 7.2 percent above the October 2015 rate of 984,000.
Single-family completions were at a rate of 749,000, or 3.9 percent above the revised September rate of 721,000. Single-family completions are up 17.0 percent year-over-year. Multifamily, at 300,000 completions, is 12.8 percent higher compared to September, but has declined 10.4 percent from a year earlier.