Real Estate

Housing Starts Faltered In September Amid Supply Constraints

Multifamily housing starts dipped 1.6 percent in September following a month in which the sector delivered surprising gains while single-family housing starts remained steady from the previous month.

Multifamily housing starts dipped 1.6 percent in September to a seasonally adjusted annual rate of 1,555,000 following a month in which the sector delivered surprising gains, according to the U.S. Census Bureau’s September 2021 New Residential Construction Report. Those starts were still 7.4 percent above the September 2020 rate of 1,448,000, however.

Meanwhile, single-family housing starts remained the same from the previous month at a rate of 1,080,000.

Labor and material shortages have continued to hamper builders’ progress, Kelly Mangold, principal at RCLCO Real Estate Consulting, told Inman in a statement.

“New home starts declined in September after an initial rebound in August amid continued concerns about delivery timelines,” Mangold said. “As in previous months, the multifamily sector made up a significant share of total starts, as both single-family and multifamily properties have struggled with similar labor and material shortages.”

“While low interest rates have fueled robust demand, builders and developers must continue to devise creative solutions to keep projects moving, allowing much-needed residential inventory to progress toward delivery,” she added.

Privately owned building permits also saw a sharp decline of 7.7 percent from August to a rate of 1,589,000 — the same rate as in September 2020. Single-family authorizations, likewise, declined slightly to a rate of 1,041,000, down 0.9 percent from August.

Housing completions for privately owned buildings were 4.6 percent below August’s estimate, and 13.0 percent below September 2020’s estimate, to a seasonally adjusted annual rate of 1,240,000. Single-family housing completions, meanwhile, remained steady from August at a rate of 953,000.

Email Lillian Dickerson

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