Housing starts down, but market continues recovery

Condos being built in Brooklyn, New York Photo: Michael Tapp

Housing starts have fallen in the US, but the market is continuing its gradual recovery.

Led by a steep drop in multifamily production, nationwide housing starts fell 11 per cent to a seasonally adjusted annual rate of 1.06 million units in October 2015, according to newly released data from the US Department of Housing and Urban Development and the Commerce Department.

Nonetheless, permits are rising, notes optimistic NAHB Chairman Tom Woods, a home builder from Blue Springs, Mo.

Multifamily permits rose 6.8 percent to a rate of 439,000 while single-family permits increased 2.4 percent to 711,000.

Regionally, the Northeast, Midwest and South posted respective permit gains of 5.9 percent, 2.4 percent and 7.5 percent. The West fell 2.6 percent.

"Even though starts dropped in October, they have stayed above the one million mark for seven straight month," says Woods. "The longest streak in almost seven years."

"This month’s decline can be attributable to the volatile multifamily sector adjusting to trend after an unusually high September, as well as the storms and flooding affecting single-family production in the South," adds NAHB Chief Economist David Crowe. "However, with permits ticking upward, we expect to see the housing market continue to grow at a modest pace."