{"id":2767,"date":"2022-01-19T15:40:02","date_gmt":"2022-01-19T15:40:02","guid":{"rendered":"https:\/\/preprod.realtrends.com\/blog\/2022\/01\/19\/housing-starts-reach-nine-month-high-in-december\/"},"modified":"2025-03-13T02:39:59","modified_gmt":"2025-03-13T02:39:59","slug":"housing-starts-reach-nine-month-high-in-december","status":"publish","type":"post","link":"https:\/\/preprod.realtrends.com\/blog\/2022\/01\/19\/housing-starts-reach-nine-month-high-in-december\/","title":{"rendered":"Housing starts reach nine-month high in December"},"content":{"rendered":"\n

After posting a double digit gain in November<\/a>, housing starts were up yet again in December, rising 1.4% month over month to a seasonally adjusted annual rate of 1.70 million according to a report<\/a> released Wednesday by the U.S. Department of Housing and Urban Development<\/strong> and the U.S. Census Bureau.<\/strong><\/p>\n\n\n\n

This is the highest level housing starts have reached in the past nine months.<\/p>\n\n\n\n

Construction of single-family homes dropped 2.3% from November to  1.172 million units, the construction of multifamily units again posted a sizable increase of 13.7% to 524,000 units.<\/p>\n\n\n\n

\u201cHousing starts had one last push in store to end 2021, rising modestly from November against expectations for a small decline \u2014 a fitting conclusion to a year of remarkable stability for housing starts,\u201d Zillow <\/strong>senior economist Kwame Donaldson said in a statement. \u201cAcross the United States, homebuilders reliably broke ground on between 125,000 and 140,000 homes almost every month in 2021, and by one common measure, last year was the second-least volatile year for housing starts since 2005.\u201d<\/p>\n\n\n\n

Overall, an estimated 1,595,100 housing units were started in 2021, a 15.6% increase from 2020.<\/p>\n\n\n\n

\u201cHousing demand has outstripped supply since 2009,\u201d First American <\/strong>deputy chief economist Odeta Kushi said in a statement. \u201cThe last housing starts report of 2021 is a positive step towards bridging the gap between supply and demand, as an estimated 1,337,800 housing units were completed in 2021 \u2013 4.0% above the 2020 figure. 2021 was a strong year for construction.\u201d<\/p>\n\n\n\n

Experts are attributing the stability of housing starts this year to a slowly improving labor market, low mortgage rates, high demand for housing and an extremely low level of existing housing inventory.<\/p>\n\n\n\n

Also showing an increase in December was the number of building permits issued, rising 9.1% from November to 1,873,000. But while this is good news for new housing construction, homebuilders still have plenty of obstacles to overcome.<\/p>\n\n\n\n

\u201cThe shortage of skilled labor, materials and lots, are headwinds to increasing the pace of new construction,\u201d Kushi said. \u201cThe good news in the December housing starts report is the number of single-family homes permitted, but not started declined to its lowest level since April 2021, but remains elevated compared to pre-pandemic. The price of labor, lots and lumber is increasing, and these rising costs are being passed on to home buyers in the form of rising new home prices during a time when mortgage rates are expected to rise.\u201d<\/p>\n\n\n\n

As a reflection of these concerns, the National Association of Home Builders<\/strong> (NAHB) and Wells Fargo Housing Market Index<\/strong> (HMI) measuring homebuilder confidence<\/a> in the market for newly built single-family homes, fell one point in January to 83.<\/p>\n\n\n\n

Regionally, on a year-to-date basis, combined single-family and multifamily starts are 0.7% higher in the Northeast, 17.1% higher in the Midwest, 9.3% higher in the South and down 18.1% in the West, compared to a year prior.<\/p>\n","protected":false},"excerpt":{"rendered":"

Housing starts ticked up 1.3% in December to a seasonally adjusted annual rate of 1.70 million. 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