Single-family housing starts fell month over month in June.
Starts were at a rate of 980,000, a 2.2% decrease from the revised May figure of 1,002,000, according to the U.S. Census Bureau and the Department of Housing and Urban Development.
Privately owned housing starts in June were at a seasonally adjusted annual rate of 1,353,000. This is 3% above the revised May estimate of 1,314,000 but 4.4% below the June 2023 rate of 1,415,000.
“Month to month, builders continue to pull back on starts of new single-family homes, attempting to keep inventory aligned with current demand. The affordability challenge due to high mortgage rates and high prices has kept many would-be home buyers on the sidelines. With single-family permits also decreasing, any rebound in starts could be soft, even if the Fed begins to cut interest rates. Overall, these decreases in single-family construction activity do not bode well for the nation’s lack of housing supply,” says Eric Alanis, senior analyst, published research at Zonda.
Housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,446,000. The rate is 3.4% above the revised May rate of 1,399,000 but 3.1% below the June 2023 rate of 1,493,000. Single-family authorizations in June were at a rate of 934,000, which is 2.3% below the revised May figure of 956,000. Authorizations of units in buildings with five units or more were at a rate of 460,000 in June.
June’s housing completions were at a seasonally adjusted annual rate of 1,710,000, which is 10.1% above the revised May estimate of 1,553,000 and 15.5% above the June 2023 rate of 1,480,000. Single-family housing completions were at a rate of 1,037,000 and 1.8% above the revised May rate of 1,019,000. The June rate for units in buildings with five units or more was 656,000.
“You can draw a variety of conclusions about what happened with home construction in June, depending on which numbers you focus on. It’s more enlightening to pull back and look at what happened in the first six months of 2024 compared to the first half of 2023,” says Holden Lewis, home expert at NerdWallet. “Builders began construction on 16% more single-family houses compared to 2023. Meanwhile, they started construction on 36% fewer apartments. This is happening because there was an apartment construction boom in 2022 and 2023, and the influx of new apartments tamped down on rent inflation. So, builders switched over to houses, whose prices have stayed up.”
