Total housing starts posted a 3.6 percent decline in January (1.57 million units) compared to an upwardly revised December estimate of 1.63 million units according to the joint data release from the Census Bureau and HUD. Relative to January 2019 (during the housing soft patch), total starts are 21.4 percent above the annual pace of 1.29 million units.
Single-family starts posted a monthly decline of 5.9 percent to a still strong seasonally adjusted annual rate of 1,010,000. The December annualized pace for single-family starts was revised up to 1,073,000. The three-month moving average for single-family in January is an annual rate of 1,008,000 units, which is the highest pace since the Great recession.
Single-family permits, a useful indicator of future construction activity, was 6.4 percent higher at 987,000 annual pace in January compared to December and have registered a 20.2 percent gain compared to a year ago. This is in line with the NAHB/Wells Fargo Housing Market Index, which held builder confidence in the market for newly-built single-family homes at a solid level of 74 in February.
Multifamily starts (2+ unit production) posted an increase of 0.7 percent in January to a 557,000 annual rate compared to the previous month. On a year-over-year basis, multifamily unit production is up 71.4 percent while multifamily permitting is trending higher with an increase of 13.9 percent.
Regional data show, on a year-over-year basis positive conditions for single-family construction in the West (+24.7 percent) and Midwest (+17.7 percent) while South (-3.7 percent) and Northeast (-15.4 percent) have posted declines.