Hurricanes Blamed for Decrease in September Housing Starts
Home-building activity tumbled in September, with housing starts down 4.7% to a rate of 1.127 million, according to the latest data.
WASHINGTON, D.C. — Housing starts in the U.S. slipped again in September, marking the fifth decrease in six months, with Hurricanes Harvey and Irma blamed for disrupting construction of single-family homes in the South.
Privately owned housing starts slid 4.7% to a 1.127 million unit rate from a 1.183 million rate in August, according to the latest numbers from the U.S Census Bureau and the U.S. Department of Housing and Urban Development.
Nationwide single-family production fell 4.6% to 829,000 units due to a 15.3% decline in the hurricane-ravaged South. All other regions posted gains in the single-family sector, and nationwide single-family permits increased 2.4%.
Despite the months-long decline in housing starts, builder confidence in the market for newly-built single-family homes increased four points to a level of 68 in October, according to the NAHB/Wells Fargo Housing Market Index (HMI). That was the highest reading since May.
“We are seeing the hurricanes take a toll on single-family production, but builder confidence is strong and production should bounce back as the recovery process gets underway,” Granger MacDonald, chairman of the National Association of Home Builders (NAHB), said in a statement.
Based on historical data, a pattern of decreased production immediately following natural disasters can be expected but economic fundamentals will drive the longer-term trend in housing starts, according to NAHB Senior Economist Michael Neal. “Nationwide single-family permits are up this month, and year-to-date single-family starts are 9.1 percent ahead of their level over the same period last year — two indicators that this sector continues to improve,” he said in a statement.
The seasonally adjusted rate of new building permits fell to 1.22 million, down 4.5% from the upwardly revised August rate of 1.27 million, and down 4.3% from the September 2016 rate of 1.27 million. The consensus estimate called for 1.24 million new building permits.
Multifamily starts declined by 5.1% during September to 298,000 units, with steep declines reported in the Midwest and Northeast.
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