New single-family home construction swung back to positive territory in September after an August slump, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development said in a press release.
Specifically, single-family homes were built at a seasonally adjusted annual rate of 963,000, up 3.2% from 933,000 in August and up 8.6% from 887,000 in September 2022. Multifamily residential starts, meanwhile, surged 17.1% from August to 383,000, which is 31.5% below the year-ago level of 559,000.
Altogether, housing starts, which include multifamily and single-family residences, rose 7% to 1,358,000 from 1,269,000 in August. Year over year, however, starts were down 7.2% from September 2022’s pace of 1,463,000.
Meanwhile, single-family permits, a leading indicator of future new-home supply, rose 1.8% month over month and 11.6% year over year to 965,000 units, while single-family completions rose 5.3% month over month but fell 4.8% year over year to an annual rate of 998,000.
“Higher single-family permits are a sign of cautious optimism,” First American Deputy Chief Economist Odeta Kushi said. “Builders have benefited from the lack of resale inventory and from their ability to use incentives, such as mortgage rate buydowns, to entice buyers off the sidelines. Builders have a huge competitive advantage over the resale market in this way.”