NAHB emphasizes growth in single-home starts

Although total starts declined, last week's construction data from the U.S. Commerce Department showed the third-straight month of single-family gains.

The National Association of Home Builders emphasized the positive trends occurring in the single-family market. Nationwide production of new single-family homes rose 4.4% to a seasonally adjusted annual rate of 470,000 units in December, according to the data.

The report "adds to the growing evidence that demand for new, single-family homes is finally starting to firm up in an increasing number of markets nationwide,” said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. “This emerging trend is allowing builders to put more crews back to work, and could be even stronger if  not for the overly tight credit conditions that prevail for both builders and buyers, as well as the continuing foreclosure crisis and the challenges of obtaining accurate appraisal values on new homes. Policymakers should be doing everything possible to alleviate these problems and nurture the fledgling housing recovery in order to promote job and economic growth.”  

This marked a third consecutive increase and the fastest pace of single-family housing starts since April of 2010. Meanwhile, the overall number of housing starts for the month declined 4.1 percent to a 657,000-unit rate due to a 20.4 percent dip on the more volatile multifamily side. 

“This report is in keeping with our expectations for slow but steady improvement in the single-family market, where production hit its lowest yearly rate in over 50 years in 2011,” said NAHB Chief Economist David Crowe. “Meanwhile, it should be noted that the decline in multifamily starts in December was coming off a dramatic increase from the previous month and simply brought that sector back closer to trend. Apartment production generally continues to gain strength heading into 2012 after posting a more-than 50 percent gain in 2011.” Looking forward, NAHB is forecasting gains of approximately 17 percent in both single- and multifamily housing production in 2012.