October Housing Starts Maintain Solid Upward Trend

The U.S. Census Bureau and the Department of Housing and Urban Development reported Tuesday morning that new housing starts in October rose to a seasonally adjusted annual rate of 1.31 million, an increase of 3.8% from the upwardly revised September rate of 1.266 million and an increase of 8.5% compared with the October 2018 rate of 1.211 million.

The revision to the September rate added 10,000 new housing starts to the previously reported total. The consensus estimate from a survey of economists expected an October rate of around 1.32 million.

On a non-seasonally adjusted basis, housing starts are down 0.6% year over year through October. Single-family starts were down 1.3% and buildings with two to four units have fallen by 7%.

Single-family housing starts rose by 2% month over month in October to 936,000 units on a seasonally adjusted basis. Month over month, new construction of single-family homes dipped by 32.8% in the Northeast and rose by 9.3% in the West, 3.2% in the South and 0.8% in the Midwest.

The seasonally adjusted rate of new building permits rose to 1.461 million in October, up 5% from the revised September rate of 1.391 million and 14.1% higher than the September 2018 rate.

Permits for new single-family homes rose by 3.2% month over month from a revised annual rate of 881,000 in September to a seasonally adjusted annual rate of 909,000. The rate also increased by 7.4% year over year.

Year over year, multifamily starts for buildings with five or more units increased by 10.7% in October to 362,000. This number is more volatile than the single-family number and has moved mostly sideways on an annual basis since 2013.

In 2018, 1.242 million housing units were started, up 3.2% compared with 2017. An estimated 1.311 million permits were issued in 2017, up about 3.7% year over year. These totals are subject to future revisions.