The March Housing Starts Summary shows privately-owned housing starts increased to a seasonally adjusted annual rate of 917,000, up 0.8 percent over January’s estimate and up more than 27 percent year over year.
The February Housing Starts Summary demonstrates a continuation of the trend seen over the past two years—rising prices, increased housing starts and permits, with decreased time on market for resale homes. In short, the housing comeback is gaining steam and on track for future growth. Consumers and builders alike are taking notice.
Single-family
Home construction starts for February increased 0.5 percent over January’s numbers to an annual rate of 618,000; a year over year increase of 31.5 percent.
Multi-Family
The rate of starts for buildings with five or more units was 285,000, up from last February 2012’s numbers of 233,000.
Housing Completions
The rate of completions for single-family homes was 574,000, an increase of 3.6 percent, per the Housing Starts Summary. This is another key indicator of overall demand in the housing market.
Building Permits
The Housing Starts Summary also noted an increase in privately-owned housing permits of 4.6 percent above the January rate to 946,000, which exceeds last February’s estimate by 33.8 percent.
Single –family permits increased 2.7 percent over January’s numbers.
While buyers look to builders for homes, builders express some frustration amid all the consumer demand. NAHB Chairman Rick Judson stated that builder’s enthusiasm is “tempered by frustrating bottlenecks in the supply of developed lots and rising costs of building and labor.” Two concerns Judson mentioned include below market appraisals and credit availability. Although the conditions for borrowers and builders might not be perfect, several elements contributing to growth and demand are in place. A key factor influencing homebuyers to purchase new construction is the shortage of inventory in the resale market. Inventory has continued to decrease across the country in the majority of metros. The February Housing Starts Summary showed modest month-over-month gains and strong year-over-year gains. The big picture is clear: demand for new homes is on the rise.
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