{"id":3414,"date":"2022-08-16T16:43:49","date_gmt":"2022-08-16T16:43:49","guid":{"rendered":"https:\/\/preprod.realtrends.com\/blog\/2022\/08\/16\/housing-starts-fell-again-in-july\/"},"modified":"2025-03-13T02:46:15","modified_gmt":"2025-03-13T02:46:15","slug":"housing-starts-fell-again-in-july","status":"publish","type":"post","link":"https:\/\/preprod.realtrends.com\/blog\/2022\/08\/16\/housing-starts-fell-again-in-july\/","title":{"rendered":"Housing starts fell again in July"},"content":{"rendered":"\n<p>There&#8217;s good reason for homebuilder pessimism \u2013\u00a0housing starts fell again in July, dropping 9.6% from <a href=\"https:\/\/preprod.realtrends.com\/blog\/articles\/single-family-housing-starts-plummet-and-its-going-to-get-worse\/\" target=\"_blank\" rel=\"noreferrer noopener\">June<\/a>, according to a <a href=\"https:\/\/www.census.gov\/economic-indicators\/?utm_campaign=&amp;utm_content=&amp;utm_medium=email&amp;utm_source=govdelivery\" target=\"_blank\" rel=\"noreferrer noopener\">report<\/a> released Tuesday by the <strong>U.S. Census Bureau<\/strong>\u00a0and the\u00a0<strong>U.S. Department of Housing and Urban Development<\/strong>.<\/p>\n\n\n\n<p>In July, housing starts dropped to a seasonally adjusted annual rate of 1.446 million. This rate is 8.1% lower than the rate recorded in July 2021, reflecting the decline <a href=\"https:\/\/preprod.realtrends.com\/blog\/articles\/homebuilders-lament-the-housing-recession\/\" target=\"_blank\" rel=\"noreferrer noopener\">in homebuilder sentiment.<\/a><\/p>\n\n\n\n<p>\u201cThe decrease in single-family housing starts mirrors the decline in homebuilder confidence, which turned negative in August, driven by declines in all three components of the index: current single-family home sales, future sales expectations, and traffic of prospective buyers,\u201d Odeta Kushi, <strong>First American\u2019s <\/strong>Deputy Chief Economist, said in a statement.<\/p>\n\n\n\n<p>Single-family housing starts dropped 10.1% month over month and 18.5% year over year, to a rate of 916,000. Compared to the month prior, multi-family housing starts were also down, dropping 10.0% to a rate of 514,000, however this is a 17.4% increase from a year prior.<\/p>\n\n\n\n<p>\u201cConstruction starts of both single-family and multifamily housing units fell in July. The decline in single-family starts to 916,000 annualized units is the lowest since the COVID-19 lockdown months in the spring of 2020 and essentially matches the annual total of 888,000 in 2019 before the pandemic,\u201d Lawrence Yun, the <strong>National Association of Realtor<\/strong>\u2019s chief economist, said in a statement. \u201cThe decline in multifamily starts to 530,000 (from 580,000 in the prior month) could be just the normal month-to-month volatility in apartment buildings. What is important is that multifamily construction is on pace this year to reach the highest activity in more than 30 years.\u201d<\/p>\n\n\n\n<p>After months of dealing with <a href=\"https:\/\/preprod.realtrends.com\/blog\/articles\/are-homebuilders-too-pessimistic\/\" target=\"_blank\" rel=\"noreferrer noopener\">construction backlogs<\/a>, thanks in part to slowing demand, homebuilders were able to make progress with housing completions, which rose 1.1% month over month and 3.5% from a year ago, to a rate of 1.424 million. Single-family housing completions were up a solid 7.0% from July 2021.<\/p>\n\n\n\n<p>\u201cFor the first time since June 2020, single-family completions are higher than starts, as builders focus on finishing existing projects, rather than starting new ones,\u201d Kushi said.<\/p>\n\n\n\n<p>Looking ahead, things do not look promising for housing starts in the second half of the year, especially as the number of single-family building permits issued in July dropped 4.3% from June and 11.7% year over year to a rate of 928,000. However, thanks to a 26.2% annual increase in the number of multi-family permits issued, the overall number of building permits rose 1.1% year over year to 1.674 million.<\/p>\n\n\n\n<p>\u201cWhile builders may respond to the decline in affordability and cooling demand in the purchase market by building fewer single-family homes, it\u2019s possible that they will continue to build more rental units,\u201d Kushi said. \u201cRents remain elevated, which may incentivize building, despite higher financing costs.\u201d<\/p>\n\n\n\n<p>Despite these challenges, Yun feels there are some reasons to remain optimistic.<\/p>\n\n\n\n<p>\u201cHomebuilders are naturally very cautious about rising unsold inventory during the construction phase,\u201d Yun said. \u201cBut those completed homes are finding buyers within three months, which is relatively swift for the new homes market. Improving conditions within the supply chain for the delivery of items such as lumber and appliances will lessen overall uncertainty.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>As homebuyer demand wanes, housing starts continued to fall in July as builders are wary of accumulating a backlog of inventory.<\/p>\n","protected":false},"author":34740,"featured_media":4822,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3255],"tags":[],"coauthors":[1760],"class_list":["post-3414","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-archive"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v25.4 (Yoast SEO v26.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Housing starts fell again in July - RealTrends - Blog<\/title>\n<meta name=\"description\" content=\"As homebuyer demand wanes, housing starts continued to fall in July as builders are wary of accumulating a backlog of inventory.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/preprod.realtrends.com\/blog\/2022\/08\/16\/housing-starts-fell-again-in-july\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Housing starts fell again in July\" \/>\n<meta property=\"og:description\" content=\"As homebuyer demand wanes, housing starts continued to fall in July as builders are wary of accumulating a backlog of inventory.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/preprod.realtrends.com\/blog\/2022\/08\/16\/housing-starts-fell-again-in-july\/\" \/>\n<meta property=\"og:site_name\" content=\"RealTrends - 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