Single-family housing permits extend five-month surge – The Property Chronicle
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Single-family housing permits extend five-month surge

The Analyst

Housing activity – starts and permits – posted strong results in September as the single-family segment made gains across most of the country while multifamily housing appears to be trending flat. Total housing starts rose to a 1.415 million annual rate from a 1.388 million pace in August, a 1.9% increase. The September gain is the fourth rise in the last five months since hitting an April low.

The dominant single-family segment, which accounts for almost 80% of new home construction, rose 8.5% for the month to a rate of 1.108 million. Starts of multifamily structures with five or more units tumbled 14.7% to 295,000. From a year ago, total starts are up 11.1% with single-family starts up 22.3% and multifamily starts down 17.4%.

Among the regions in the report, total starts rose in three of the four regions. The Northeast led the gainers with a 66.7% surge while the South, the largest region by volume, rose 6.2%, and the West gained 1.4% for the month. The Midwest fell 32.7%. For the single-family segment, the Northeast again led with a 20.7% rise while the South increased 17.7% and the West added 1.6% for the month. The Midwest had a 16.4% drop.

For housing permits, total permits jumped 5.2% to 1.553 million from 1.476 million in August. Total permits are 8.1% above the September 2019 level. Single-family permits were up 7.8% at 1.119 million, the highest rate since March 2007, while permits for two- to four-family units fell 15.4% and permits for five or more units increased 1.0% to 390,000. Combined multifamily permits were 434,000, down 0.9% for the month and 19.2% from a year ago. Overall, single-family permits are showing persistent strength since the April low while multifamily permits are essentially trending sideways (see first chart).

The Analyst

About Robert Hughes

Robert Hughes joined the American Institute for Economic Research in 2013 following more than 25 years in economic and financial markets research on Wall Street. He was formerly the Head of Global Equity Strategy for Brown Brothers Harriman, where he developed equity investment strategy combining top-down macro analysis with bottom-up fundamentals. Prior to that, he was a senior equity strategist for State Street Global Markets, senior economic strategist with Prudential Equity Group and senior economist and financial markets analyst for Citicorp Investment Services.

Articles by Robert Hughes

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