Builders
started construction of privately-owned housing units in
December at a seasonally adjusted annual rate (SAAR) of 1,669,000 units (1.558
million expected).
This is 5.8 percent (±11.0 percent)* above the revised November estimate of
1,578,000 (originally 1.547 million units) and 5.2 percent (±10.1 percent)*
above the December 2019 SAAR of 1,587,000 units; the not-seasonally adjusted
YoY change (shown in the table above) was +4.6%.
Single-family
housing starts in December were at a SAAR of 1,338,000; this is 12.0 percent
(±13.4 percent)* above the revised November figure of 1,195,000 units (+29.6%
YoY). Multi-family: 331,000 units (-13.6% MoM; -39.1% YoY).
An
estimated 1,380,300 housing units were started in 2020. This is 7.0 percent
(±2.3 percent) above the 2019 figure of 1,290,000.
* 90% confidence interval (CI) is not statistically different from zero. The Census Bureau does not publish CIs for the entire multi-unit category.
Total
completions were at a SAAR of 1,417,000. This is 15.9 percent (±14.8 percent)
above the revised November estimate of 1,223,000 (originally 1.163 million
units) and 8.0 percent (±12.2 percent)* above the December 2019 SAAR of
1,312,000 units; the NSA comparison: +9.2% YoY.
Single-family
housing completions in December were at a SAAR of 984,000; this is 10.2 percent
(±17.0 percent)* above the revised November rate of 893,000 units (+9.2% YoY).
Multi-family: 433,000 units (+31.2% MoM; +9.0% YoY).
An estimated 1,290,600 housing units were completed in 2020. This is 2.8 percent (±3.4 percent)* above the 2019 figure of 1,255,100.
Total
permits amounted to a SAAR of 1,709,000 units (1.610 million expected). This is
4.5 percent (±1.4 percent) above the revised November rate of 1,635,000 (originally
1.639 million units) and 17.3 percent (±1.8 percent) above the December 2019 SAAR
of 1,457,000 units; the NSA comparison: +21.1% YoY.
Single-family
permits were at a SAAR of 1,226,000; this is 7.8 percent (±0.9 percent) above
the revised November figure of 1,137,000 units (+38.3% YoY). Multi-family: 483,000
units (-3.0% MoM; -2.6% YoY).
An estimated 1,452,000 housing units were authorized by building permits in 2020. This is 4.8 percent (±0.4 percent) above the 2019 figure of 1,386,000.
Rising
material costs led by a huge upsurge in lumber prices, along with a resurgence
of the coronavirus across much of the nation, pushed builder confidence in the
market for newly built single-family homes down three points to 83 in January,
according to the latest NAHB/Wells Fargo Housing Market Index. Despite the
drop, builder sentiment remains at a strong level.
“Despite
robust housing demand and low mortgage rates, buyers are facing a dearth of new
homes on the market, which is exacerbating affordability problems,” said NAHB
Chairman Chuck
Fowke. “Builders are grappling with supply-side constraints related to
lumber and other material costs, a lack of affordable lots and labor shortages
that delay delivery times and put upward pressure on home prices. They are also
concerned about a changing regulatory environment.”
“While
housing continues to help lead the economy forward, limited inventory is
constraining more robust growth,” said NAHB Chief Economist Robert Dietz. “A
shortage of buildable lots is making it difficult to meet strong demand and
rising material prices are far outpacing increases in home prices, which in
turn is harming housing affordability.”
The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.
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