Housing Starts Fall In April After March Increase
Summary
According to the Monthly New Residential Construction report for April, released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development, privately owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1.82 million, 3.2% below the revised March rate of 1.88 million. Odeta Kushi, deputy chief economist for First American Financial Corp., said the results show that “builders still have a backlog of uncompleted homes to get through before they can break ground on new projects. The number of single-family homes authorized but not started was nearly 8.5% higher year over year in April.” She continued, “Similarly in April, there were 815,000 single-family homes under construction (seasonally adjusted), which is the highest level since 2006. Housing starts for buildings with five or more units increased nearly 17% on a monthly basis and 42% compared with one year ago.” Kushi noted that while homebuilder confidence fell for the fifth straight month in May, the remain positive “and at about the same (confidence) level as it was in 2019.” "Builders continue to face supply chain disruptions, rising input costs, and concerns that declining affordability is pricing out potential buyers, particularly first-time home buyers, which are the most rate sensitive,” she said. The housing market of 2020 and 2021 was the exception, not the norm.” The increase in mortgage rates, combined with rising house prices, she said, “may prompt first-time buyers to pull back from the market.