There has been a substantial dip in the production of U.S. multifamily housing year-over-year, but new construction of single-family units remains strong, according to a new September Census report.
Nationwide, 951,000 privately funded multifamily units were completed last month, data commissioned by the U.S. Department of Housing and Urban Development, which is seasonally adjusted, shows. That’s an 8.4 percent decline since August and a 5.8 percent drop since the same period last year.
Multifamily housing starts also dropped last month. The seasonally adjusted annual rate of 1 million housing starts was 9 percent lower than August’s number, and nearly 12 percent lower than last September.
“After strong readings during the summer, multifamily production pulled back in September,” Robert Dietz, chief economist of the National Association of Home Builders, said in a statement “Still, we expect the multifamily sector to post a good year in 2016, though down a bit from last year, which was likely the peak year for this cycle.”
On the single-family front, completions were also down in September. The 687,000 units that finished construction reflect an 8.8 percent decrease since August. But single-family authorized permits and starts were up since last month. There were 783,000 single-family housing starts in September — the highest since February and 8.1 percent higher than in August.
Thanks to strong job growth and persistently low mortgage rates, single-family building will continue to fare well in the months ahead, NAHB chairman Ed Brady predicted.
In line with the Census report, the latest reading of the NAHB housing market index shows that homebuilder confidence decreased by two points to 63 between September and October.