Starts and permits had a strong month in November, thanks to a flurry of multifamily activity. Across the board, starts and permits were up in both the single-family and multifamily sectors, according to data released today from the U.S. Census Bureau.
Permits, the better measured of the two indicators, were up 5.7% from October’s revised rate and surged 20.7% year-over-year, coming in at an annual rate of 681,000. Single-family permits were up 1.6% from October, and up 3.6% year-over-year. However, most of the improvement came from multifamily permit activity, which saw a 13.9% monthly rise and registered the highest level seen in three years; permits for buildings with five units or more were up 80.6% annually.
Starts also saw a strong lift from the multifamily sector. Overall, starts were 9.3% higher on a monthly basis and up 24.3% year-over-year, with an annual rate of 685,000. Multifamily starts gained 25.3% from October; year-over-year, starts among buildings with five units or more were up 180.5%. Single-family starts were up 2.3% on a monthly basis and down 1.5% annually.
“The stars continue to align for [the multifamily] segment,” wrote Patrick Newport, U.S. economist at IHS Global Insight, in a brief regarding the numbers today. “Rents are rising (as are the prices of rental properties), rental vacancy rates are falling, the economy continues to create enough jobs to sustain a moderate recovery, and homeownership rates are falling.”
But while November’s housing starts were at their highest level in 19 months, by historical measures, the numbers remain low. Both single-family starts and single-family permits are on track for record low postings this year (data start in 1959 and 1960, respectively).
Still, “this was a good report,” Newport wrote. “It has supporting evidence that the single-family market is finally getting off the mat and that the multifamily segment is continuing to make small strides, and that we should expect good housing starts numbers in the upcoming months.”
Claire Easley is a senior editor at Builder.
Learn more about markets featured in this article: Greenville, SC.
