Housing starts fell in July as economic uncertainty, rising construction costs, labor shortages and elevated financing expenses continued to challenge builders.
Overall housing starts decreased 12.4% in July to a seasonally adjusted annual rate of 1.24 million units, according to a report from the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau. This pace reflects the number of housing units builders would begin over the next 12 months if July’s activity were sustained.
Within the total, single-family starts decreased 9.9% to an 808,000 seasonally adjusted annual rate and were down 15.7% compared to July 2025. On a year-to-date basis, single-family starts are down 6.9%. Given recent volatility, the three-month moving average provides a clearer signal, falling to 865,000 units.
Multifamily starts, which include apartment buildings and condominiums, decreased 16.8% from June to July to an annualized 431,000 pace. The three-month moving average for multifamily construction has trended lower to 414,000 units, and activity is 8.9% lower compared to year-earlier levels.
Regionally, on a year-to-date basis, combined single-family and multifamily starts were 11.7% higher in the Northeast, 3.0% lower in the South, 3.8% lower in the West, and 4.5% lower in the Midwest. Single-family starts were down in all four regions.
The total number of housing units under construction stood at 1.26 million in July, down 6.0% from a year earlier. Single-family homes under construction stood at 579,000 units, a 7.2% year-over-year decline. Multifamily units under construction slowed Single-to 683,000, down from peaks above 1 million units in December 2023 and 4.9% lower than a year ago.
Single-family completions slowed to an annualized rate of about 878,000 units, down 12.8% from a year earlier. On the same note, multifamily completions for buildings with five or more units declined 25.6% year over year to a 329,000-unit pace. On a year-to-date basis, total completions across both sectors are down 11.4%, reflecting ongoing challenges in the residential construction sector.
Looking ahead, overall permits increased 5.0% in July to an annualized rate of 1.44 million units. Single-family permits increased 2.5% to an 894,000-unit rate and are up 1.1% compared to July 2025. Multifamily permits climbed 9.4% to an annualized 549,000 pace and are up 6.4% compared to July 2025. Looking at regional permit data on a year-to-date basis, total permits were 14.3% higher in the Northeast, 2.6% higher in the Midwest, 2.1% higher in the West, but 4.7% lower in the South. For single-family permits, the Midwest was the only region to post an increase, rising 2.3%, reflecting relative strength in that region’s residential construction market.