Multifamily Surge Lifts US Housing Starts in June Amid Single-Family Slowdown and High Mortgage Rates

Multifamily Surge Lifts US Housing Starts in June Amid Single-Family Slowdown and High Mortgage Rates

US: Housing Starts Rise in June Driven by Multifamily Growth, While Single-Family Construction Slows, according to the US Census Bureau’s July 18 statement. Privately owned housing starts reached a seasonally adjusted annual rate of 1,321,000 units in June, marking a 4.6% increase from May. However, year-on-year, housing starts dipped by 0.5%. The surge was largely fuelled by a 30.6% monthly rise in multifamily construction, while single-family housing starts fell 4.6%, raising concerns within the sector. Regionally, the Northeast saw a sharp 73.3% increase, rising from 105,000 units in May to 182,000 units in June. Other regions experienced declines ranging from 0.7% to 5.3%.

The National Association of Home Builders (NAHB) attributed the decline in single-family starts to rising inventories, elevated interest rates, and persistent supply challenges.

Mortgage rates continue to remain high, with the average 30-year fixed rate at 6.75% as of July 17, staying above 6.5% every week this year and over 6% since mid-September 2022. The median sales price of new homes in May stood at $426,600 USD, fluctuating between $460,000 and $397,000 since October 2022. High mortgage rates and elevated prices are deterring prospective buyers, particularly for single-family homes. Hughes emphasized the need for policymakers to ease housing costs by removing regulatory barriers, promoting skilled trades, resolving permitting delays, and addressing zoning inefficiencies.

Source: NTD