November housing starts grew to a seasonally adjusted annual rate of 1.26 million, a 3.2 percent increase from October and a 5.1 percent increase year-over-year, according to the U.S. Department of Housing and Urban Development and U.S. Census Bureau.
The rate was bolstered by multifamily starts, which jumped 22.4 percent. Single-family starts dropped 4.6 percent. It’s the third consecutive month single-family starts have declined, according to the National Association of Home Builders (NAHB).
“The decline in single-family production over the last few months makes sense given the drop in our builder confidence index,” NAHB Chairman Randy Noel said in a statement. “Builders are cautious to add inventory as housing affordability concerns are causing consumers to pause on making a home purchase.”
NAHB Chief Economist Robert Dietz called the current state of housing affordability “frustrating,” because there are favorable demographics currently supporting a healthy housing demand.
“While homeownership has increased over the last nine quarters, we can expect that upward momentum to stop due to rising home costs,” Dietz stated. “Because housing leads the economy, we need to stabilize residential market conditions.”
Overall housing permits rose 5 percent in November, with single family permits inching up 0.1 percent and multifamily permits rising 14.8 percent.
Regionally, housing starts rose 11 percent in the West and 5.3 percent in the South in November. The Northeast and Midwest saw declines of 0.8 percent and 1.9 percent, respectively.
