Housing starts slip in September

Summary

• Total housing starts fell 1.6% to a 1,555K-unit pace in September. Despite the decline, new home construction is running at a solid pace. On a year-to-date basis, total starts are up 19.5% compared to the same period last year.
• Hurricane Ida, which ripped through wide swathes of the South and Northeast in early September, likely held back new construction in those areas.
• The monthly decline was owed almost entirely to a 5.0% drop in multifamily starts.
• Single-family starts were essentially unchanged, ending a two-month string of declines.
• Total building permits sunk 7.7% during the month, reversing the strong gain seen the prior month.
• Multifamily permits fell 18.3%, while single-family permits slipped 0.9%.
• Building material and skilled labor shortages continue to hamper new residential development. The number of homes under construction rose to a 1,426K-unit pace, the highest since 1974.
• Despite these headwinds, builder confidence strengthened in October. The NAHB Housing Market Index rose to 80 during the month, the highest level in three months. The single-family sales components, both present and future, rose solidly during the month, as did prospective buyer traffic.

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