Residential construction had busiest year since 2006: MBA

Housing starts jumped nearly 6% in December

National /
Jan.January 21, 2021 11:30 AM
Overall, the number of housing units that started construction last year was up 7 percent from 2019. (iStock)

Overall, the number of housing units that started construction last year was up 7 percent from 2019. (iStock)

Residential construction continued to surge as 2020 came to an end, finishing off homebuilding’s busiest year since the housing bubble burst.

Housing starts in December increased for the fourth month in a row to an annual rate of 1.67 million units, seasonally adjusted, according to the Census Bureau’s monthly report on residential construction. That’s a 5.8 percent increase from November’s revised rate and up 5.2 percent year-over-year.

Overall, the number of housing units that started construction last year was up 7 percent from 2019.

Joel Kan, head of industry forecasting for the Mortgage Bankers Association, called it “the strongest for residential construction since 2006.”

Residential projects have dominated construction spending as demand and housing prices have continued to rise with inventory shrinking and interest rates remaining low. But there are some headwinds: Homebuilder sentiment has dipped over the past two months and mortgage rates have crept up.

The annual rate of building permits in December was 1.7 million, seasonally adjusted — about 4.5 percent higher than November’s rate and up more than 17 percent year-over-year. Kan pointed to the continued uptick in permits for single-family homes as an indication of new supply to come.

The rate of housing completions also increased to 1.4 million units, seasonally adjusted. That was up about 16 percent from November’s revised rate and up 8 percent year-over-year.





    Related Articles

    arrow_forward_ios
    Rendering of Sonnen's ecoLinx home battery (Sonnen)
    Off the grid: Developers eye “virtual power plants” for properties
    Off the grid: Developers eye “virtual power plants” for properties
    Hedge fund manager Robert Citrone (Getty)
    This “Tiger Cub” hedge funder owns nearly 10% of Compass
    This “Tiger Cub” hedge funder owns nearly 10% of Compass
    Zynga founder Mark Pincus, Hippo founders Assaf Wand and Eyal Navon, and LinkedIn co-founder Reid Hoffman (Getty, LinkedIn)
    Hippo strikes $5B SPAC deal with LinkedIn, Zynga founders
    Hippo strikes $5B SPAC deal with LinkedIn, Zynga founders
    Rendering of 300 Huntington Street (Monadnock Development, iStock)
    No parking? No problem for Monadnock project in Gowanus
    No parking? No problem for Monadnock project in Gowanus
    Opendoor CEO Eric Wu (Opendoor, iStock/Illustration by Alexis Manrodt for The Real Deal)
    Opendoor revenue plunged 45% in 2020
    Opendoor revenue plunged 45% in 2020
    CoStar CEO Andy Florance
    CoStar retreats from failed CoreLogic bid
    CoStar retreats from failed CoreLogic bid
    Jimmy Fallon and Nanvy Juvonen with their penthouse at 34 Gramercy Park East (Photos via Getty/Sotheby's Jeremy V. Stein and Debbie Korb)
    Jimmy Fallon lists Gramercy Park penthouse for $15M
    Jimmy Fallon lists Gramercy Park penthouse for $15M
    In 2018, a Brookings Institution study found homes in majority-Black neighborhoods were undervalued by $48,000 on average. (iStock)
    Appraisal Institute taking steps to root out racial bias
    Appraisal Institute taking steps to root out racial bias
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...