Housing starts rebound in August
It's not accurate to say residential construction is running hot, but the latest numbers from the the U.S. Census Bureau and the U.S. Department of Housing and Urban Development show the pace of starts in August were well ahead of last year and last month.
Leading the rebound were single-family starts, which were up 15.8 percent from the previous month.
Total starts for August were at a seasonally adjusted annual rate of 1.356 million, up 9.6 percent from an anemic 1.237 million in the month of July. Total starts were also up 3.9 percent from a year ago.
As usual, residential construction varied significantly across the four regions of the country.
The Northease alone saw a big statistical swings. The region generated year-over-year single-family growth in of 52.7 percent. It also produced a 27.3 percent month-over-month decline in total starts.
Overall permits increased 4.9% to a 1.48 million unit annualized rate in August. Single-family permits increased 2.8% to a 967,000 unit rate. Multifamily permits increased 9.2% to an annualized 508,000 pace.
The Wednesday morning construction report was delivered in an environment of anticipation over potential interest rate cuts.
“With the Federal Reserve expected to begin the first of a series of rate reductions today, the loosening monetary policy over the coming months will boost new home building by lowering the construction loan rates for builders,” said Danushka Nanayakkara-Skillington, The National Association of Home Builders' assistant vice president for forecasting and analysis. “The rise in single-family permits is further good news for the industry, which was hit hard by tight monetary policy in the first half of this year.”
