The National Association of Home Builders (NAHB) announced today that U.S. housing starts had risen 11.3% in December due to multifamily production, which surged 57% to 431,000 units. However, the apartment sector has experienced strong volatility since August.
Single-family home construction was down by 4% to a seasonally adjusted annual rate of 795,000 units.
According to the NAHB, regionally, combined single- and multifamily housing production was up by 31.2% in the Midwest, 23.5% in the West and 18.5% in the Northeast. The South was down 1.4%.
Building permits had dropped slightly in December to 1.21 million units. Single-family permits surged 4.7% to 817,000 units, which was the highest level in 2016. Meanwhile, multifamily permits fell 9 percent to 393,000 units.
Regionally, permits rose 3.3 percent in the West, 2.7 percent in the Northeast and 0.5 percent in the Midwest. The South registered a decline of 2.9 percent.
“Despite the slight dip in single-family production, December’s rate is still the fourth highest single-family pace since the Great Recession, and single-family starts also posted solid gains for the year,” said Granger MacDonald, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Kerrville, Texas. “Builders remain confident and we expect further growth in the single-family market in the year ahead.”
“This report represents firm growth for housing in 2016, as single-family starts rose 9 percent and multifamily production was down slightly,” said NAHB Chief Economist Robert Dietz. “We expect that 2017 will be another year of gradual, steady improvement in the housing market. Multifamily starts have been volatile in recent months, but should level off as supply meets demand. Meanwhile, single-family production continues to gain momentum but is limited by supply-side headwinds.”
The NAHB data was based on the U.S. Department of Housing and Urban Development and the U.S. Census Bureau report.