Single-family housing production lagged in October due to supply-chain effects for materials and ongoing access issues for labor and lots. Overall housing starts decreased 0.7 percent to a seasonally adjusted annual rate of 1.52 million units, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
The October reading of 1.52 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months. Within this overall number, single-family starts decreased 3.9 percent to a 1.04 million seasonally adjusted annual rate, and are up 16.7 percent year-to-date. The multifamily sector, which includes apartment buildings and condos, increased 7.1 percent to an annualized 481,000 pace.
Due to supply-chain effects, there are 152,000 single-family units authorized but not started construction-up 43.4 percent from a year ago.
"The rising count of homes permitted but not yet started construction is a stark reminder to policymakers to fix the supply chain so that builders can access a steady source of lumber and other building materials to keep projects moving forward," says Chuck Fowke, chairman of the National Association of Home Builders.
"Single-family permit data has been roughly flat on a seasonally adjusted basis since June due to higher development and construction costs," says Robert Dietz, NAHB chief economist. "Demand remains solid but housing affordability is likely to decline in 2022 with rising interest rates."
Overall permits increased 4 percent to a 1.65 million unit annualized rate in October. Single-family permits increased 2.7 percent to a 1.07 million unit rate. Multifamily permits increased 6.6 percent to an annualized 581,000 pace.