Housing Starts, Permits Rise in August

Builders may be skeptical about the health of the housing market, but new construction numbers released Tuesday by the U.S. Census Bureau suggest the market may at last be on the mend—just in unexpected ways. Total housing starts jumped 10.5% on a monthly basis to a seasonally adjusted pace of 598,000, solidly beating the predictions of industry experts, who had predicted a decline in August starts numbers. Total building permits also rose, inching up 1.8% to a seasonally adjusted level of 569,000 units. On an annual basis, total starts are up 2.2% compared to August 2009 while permits are down 6.7% for the same time frame. The reason? Increased multifamily activity. Multifamily starts skyrocketed 32.2% on a monthly basis to a seasonally adjusted level of 160,000 while permits rose 9.8% to a seasonally adjusted level of 168,000. In comparison, single-family starts notched a smaller monthly increase, moving up 4.3% to a seasonally adjusted pace of 438,000 units. Year-over-year, such activity was down 9.1% compared to August 2009. Permits also proved slightly weaker on the single-family side, dipping 1.2% on a monthly basis to a seasonally adjusted level of 401,000 units. That’s 16.8% below the same month last year, when builders were still trying to maximize sales from the soon-expiring housing tax credit.

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