Total housing starts posted a 16.9 percent increase in December (1.608 million units) compared to a upwardly revised November estimate of 1.375 million units according to the joint data release from the Census Bureau and HUD. Relative to December 2018, total starts are 40.8 percent above the annual pace of 1.14 million units, a pace that will likely be revised down in future estimates.

The rate of single-family starts posted a monthly gain in December, increasing 11.2 percent to a seasonally adjusted annual rate of 1,055,000. November single-family starts were revised up to 949,000 units. The three-month moving average for single-family in December is 973,000 units. The December surge reflected an increase after weakness and caution for most of 2019.

On a year-to-date basis, single-family starts are 1.4 percent above as of December relative to December 2018. Single-family permits, a useful indicator of future construction activity, were flat at 916,000 units in December and have registered a 10.8 percent gain thus far in 2019 compared to last year. 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 75 in January.

Multifamily starts (2+ unit production) posted an increase of 29.8 percent in December to a 553,000 annual rate compared to the previous month. After a slow start to the year, multifamily development is moving closer to our forecast of leveling-off conditions. On a year-to-date basis, multifamily 5+ unit production is up 7.8 percent thus far in 2019, while multifamily 5+ unit permitting is trending higher with an increase of 10.8 percent.

Regional data show, on a year-to-date basis positive conditions for single-family construction in the South (+6.6 percent), while Northeast (-11.9 percent), West (-3.8 percent), and Midwest (-2.0 percent) have posted declines.

Tags: economics, home building, housing, multifamily, single-family, starts