The number of new home started nationwide in December fell 4.1 percent from November, according to construction data released today by the U.S. Census Bureau and the Department of Housing and Urban Development.
Still, builders are optimistic following the release because housing starts on single-family homes rose 4.4 percent from the previous month. A 27.8 percent month-over-month decline in construction on structures with five units or more was responsible for the overall negative number.
“Today’s report adds to the growing evidence that demand for new, single-family homes is finally starting to firm up in an increasing number of markets nationwide,” said Bob Nielsen, chairman of the National Association of Home Builders.
The association’s chief economist, David Crowe, added: “It should be noted that the decline in multi-family starts in December was coming off a dramatic increase from the previous month and simply brought that sector back closer to trend. Apartment production generally continues to gain strength heading into 2012 after posting a more-than 50 percent gain in 2011.”
On an annual basis, the data shows significant increases across the board. As overall starts, single-family starts and multi-family starts increased 24.9 percent, 11.6 percent and 69.1 percent, respectively.
The report also notes that permits for new buildings fell slightly compared to November, but were up 7.8 percent compared to December 2010. Housing completions rose 9.2 percent from November and 7.1 percent on an annual basis.
Overall, 606,900 housing units were started in 2011, 3.4 percent more than 2010′s total. Meanwhile, 583,900 were completed, 10.4 percent less than the prior year. Both figures fall far below the 1.2 million new homes that economists estimate would be built in a healthy housing market. — Adam Fusfeld