US Housing starts rise solidly in August

Wells Fargo Research Team Wells Fargo

Housing starts easily topped expectations in August, with overall starts rising 3.9% and building permits rising 6.0%. Multifamily units accounted for all the strength in starts, reflecting strong demand for apartments. Single-family starts declined slightly. The drop in single-family starts has more to do with supply shortages than weakening demand, however. Builders are increasingly having to limit sales, as they are uncertain when they will be able to complete homes due to ongoing shortages of essential building materials. The impact of supply shortages shows up in the rising number of single-family homes that have been permitted but not started, which rose 1.4% in August and is up 50% over the past year. Shortages are widespread throughout the industry, and similar to what is happening in the auto sector, with a single part, such as panel box or wedge anchors, holding up construction.

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Wells Fargo Research Team

Wells Fargo

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