Single-family and multifamily starts each posted solid gains in July, with total housing production up 22.6 percent to a seasonally adjusted annual rate of 1.50 million units, according to a report from the U.S. Housing and Urban Development and Commerce Department. This is the highest production rate since February.
Within this overall number, single-family starts increased 8.2 percent to a 940,000 seasonally adjusted annual rate. The multifamily sector, which includes apartment buildings and condos, increased 58.4 percent to a 556,000 pace.
"Strong builder confidence and heavy buyer traffic point to further production gains in the near term, but the more than 110 percent jump in lumber prices since mid-April is adding approximately $14,000 to the cost of each new single-family home," says Chuck Fowke, chairman of the National Association of Home Builders.
"The market is being buoyed by historically low interest rates, a focus on the importance of housing and a shift to the suburbs as more buyers are seeking homes in suburban communities, exurbs and more affordable low density markets," says Robert Dietz, NAHB chief economist.
Overall permits increased 18.8 percent to a 1.50 million unit annualized rate in July. Single-family permits increased 17.0 percent to a 983,000 unit rate. Multifamily permits increased 22.5 percent to a 512,000 pace.
