Thu, 2011-11-17 13:14
Single-family housing starts rose 3.9 percent to a seasonally adjusted annual rate of 430,000
units in October, according to newly released data from the U.S. Commerce
Department. This improvement was somewhat masked by an 8.3 percent decline in
multifamily starts that kept the combined number for nationwide housing
production virtually flat at 628,000 units in October. Meanwhile, single-family
permits also posted a measurable gain of 5.1 percent to 434,000 units in the
latest report, which is their fastest pace since December of 2010.
"The government's numbers for October housing production are very much in keeping
with what home builders have been telling us in our recent surveys," said Bob
Nielsen, chairman of the National Association of Home Builders (NAHB) and a home
builder from Reno, Nev. "While we still have a long way to go toward a recovery,
some signs of hope are emerging in certain markets where economic and job growth
is occurring and where foreclosures have not been an overwhelming obstacle."
While combined housing starts in October declined by a barely perceptible 0.3 percent
to a rate of 628,000 units, the single-family sector posted a 3.9 percent gain
to 430,000 units. Meanwhile, the more volatile multifamily sector posted an 8.3
percent decline to 198,000 units following an unsustainably large gain in the
previous month. Combined starts activity was up in three out of four
regions in October. Gains of 17.2 percent, 9.7 percent and 1.6 percent were
registered in the Northeast, Midwest and South, respectively, while the West
posted a 16.5 percent decline.
"The three-month moving averages for both housing production and permitting activity
have been gradually rising since this spring, which is consistent with our
forecast for slow improvement in market conditions through the end of this year
and a positive sign that a more solid recovery will begin to take hold in 2012,"
said NAHB Chief Economist David Crowe. "That said, the improvements we are
seeing are still limited to scattered local markets where economies are
improving, and obstacles such as tight credit conditions for builders and
buyers, appraisal issues stemming from new homes being compared to distressed
properties, and consumer concerns about job security are definitely slowing the
progression of both a housing and economic recovery."
Permit issuance, which can be an indicator of future building activity, rose 10.9
percent to a seasonally adjusted annual rate of 653,000 units in October on
gains in both the single- and multifamily sides. Single-family housing permits
rose 5.1 percent to 434,000 units—their highest level since December of
2010—while multifamily permits rose 24.4 percent to 219,000 units—their highest
level since October of 2008.
On a regional basis, combined permitting activity was down 1.6 percent in the
Northeast and 3.7 percent in the Midwest, but up 21.5 percent in the South and
5.4 percent in the West.