An estimated 1,380,300 housing units were started in 2020, or a 7% increase from the 2019 figure of 1,290,000, according to the final new residential construction report of 2020 from the U.S. Census Bureau and the Department of Housing and Urban Development.
Privately owned housing starts in December were at a seasonally adjusted annual rate of 1,669,000, a 5.8% increase from the revised November estimate of 1,578,000 and a 5.2% increase from the December 2019 rate of 1,587,000. Single-family housing starts last month were at a rate of 1,338,000, which is 12% above the revised November figure of 1,195,000. The December rate for units in buildings with five units or more was 312,000.
“Throughout 2020, the housing market fared much better than the broader economy, and the number of housing starts in December indicate that housing will remain bright in 2021,” says Tendayi Kapfidze, LendingTree’s chief economist. “While there is some risk that rising home costs will force lower-income buyers out of the housing market and result in a slowdown, this risk is largely offset by low rates and high demand from higher-income households that were less impacted by the coronavirus pandemic.”
An estimated 1,452,000 housing units were authorized by building permits in 2020, a 4.8% increase from the 2019 figure of 1,386,000. Privately owned housing units authorized by building permits in December were at a seasonally adjusted annual rate of 1,709,000, or 4.5% above the revised November rate of 1,635,000 and 17.3% above the December 2019 rate of 1,457,000. Single-family authorizations last month were at a rate of 1,226,000, which is 7.8% above the revised November figure of 1,137,000. Authorizations of units in buildings with five units or more were at a rate of 437,000.
Lastly, an estimated 1,290,600 housing units were completed in 2020, a 2.8% increase from the 2019 figure of 1,255,100. Privately owned housing completions in December were at a seasonally adjusted annual rate of 1,417,000, or 15.9% above the revised November estimate of 1,223,000 and 8% above the December 2019 rate of 1,312,000. Single-family housing completions last month were at a rate of 984,000, which is 10.2% above the revised November rate of 893,000. The December rate for units in buildings with five units or more was 422,000.
“The month’s gain was entirely driven by single-family starts, which jumped 12% to 1.34 million annualized units, the highest pace since 2006,” says Doug Duncan, chief economist at Fannie Mae. “While single-family starts were higher than we had forecast, the strength is consistent with our expectation that construction in coming months will continue to be strong relative to the pace of sales.”
