HUD/CENSUS BUREAU: July Housing Starts Down 1.1 Percent, Permits Rise In July
- By David M. Kinchen
Photo: David M. Kinchen
U.S. housing production — as measured by housing starts — declined 1.1 percent to a seasonally adjusted annual rate of 746,000 units in July, according to a report jointly issued Thursday, Aug. 16, 2012 by the Department of Housing and Urban Development (HUD) and the U.S. Census Bureau. Offsetting this dip, builders pulled more permits for planned new home projects than they have in any month since August of 2008.
“While many builders believe that the outlook for housing is considerably brighter than it has been in years, we are being very careful about keeping inventories tight and not building ahead of demand,” noted Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. “At the same time, builders are drawing more permits for new construction so we can accommodate buyers and renters as they return to the marketplace.”
“Our latest surveys confirm builders’ increased confidence about future home buyer demand, and that’s reflected in today’s permit numbers,” said NAHB Chief Economist David Crowe. “Increasingly, housing is re-emerging as a traditional and much-needed source of strength in local economies as builders are able to put more of their crews back to work. But two things that are slowing this process considerably are the challenges that builders continue to face in accessing credit for viable new projects and the difficulty of obtaining accurate appraisals on new homes.”
After four consecutive months of gains, single-family housing starts fell back 6.5 percent to a seasonally adjusted annual rate of 502,000 units in July. Meanwhile, multifamily starts posted a 12.4 percent gain to 244,000 units, their strongest pace since February.
On a regional basis, combined single- and multifamily starts declined 1.3 percent in the Northeast, 3.5 percent in the South and 5.3 percent in the West, but rose 17 percent in the Midwest in July.
Issuance of new building permits, which can be an indicator of future building activity, rose 6.8 percent to a seasonally adjusted annual rate of 812,000 units in July – the fastest pace in nearly four years. Single-family permits rose 4.5 percent to 513,000 units (their best pace since March of 2010) while multifamily permits rose 11.2 percent to 299,000 units.
Permit issuance rose in three out of four regions in July, with the Northeast registering a 12.2 percent gain, the South a 5.8 percent gain and the West a 14.0 percent gain. The Midwest posted a 4.2 percent decline.
Privately-owned housing completions in July were at a seasonally adjusted annual rate of 668,000. This is 7.1 percent above the revised June estimate of 624,000 and is 5.4 percent above the July 2011 rate of 634,000.
Single-family housing completions in July were at a rate of 448,000; this is 5.9 percent below the revised June rate of 476,000. The July rate for units in buildings with five units or more was 209,000.