Housing starts and permits had double digit positive moves in November as reported by the Census Bureau and HUD. The November starts figures rebounded from a low October level but still managed to exceed half of the monthly levels reported for 2015. Single-family starts were up 7.6% to 768,000, their highest level since January 2008. Every region except the Midwest experienced a rise in single-family starts.
Permits also peaked at their highest level since August 2007 at 1,289,000 which was up 11% from an upwardly revised October. Single-family permits were up modestly but enough to also set an eight year record of 723,000. Single-family permits rose in every region except the South, which was still the second highest of the year.
Multifamily starts rose 16.4% offsetting a 25% drop in October to a 405,000 level and very near the average so far this year of 396,000. Multifamily permits jumped to 566,000, a 26.9% rise, well above the year-to-date average of 481,000.
November levels for starts and permits reflect builders’ steady expectations for continued modest growth in housing demand for both apartment rentals and single-family owned homes. Younger, newly-formed households are headed for apartment rentals in record numbers as the millennial generation begins to move out of their parents’ homes and into their own living arrangement. Current home owners who have delayed moving because of economic reasons are finally taking advantage of low mortgage rates and affordable home prices to make the move they postponed. Neither movement is expected to be dramatic but rather a small speed up in the trends that have been developing over the past two years as the economy cures, employment grows and consumer confidence returns.