September 2021 Residential Permits, Starts and Completions

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Builders started construction of privately-owned housing units in September at a seasonally adjusted annual rate (SAAR) of 1,555,000 units (1.621 million expected).  This is 1.6 percent (±11.4 percent)* below the revised August estimate of 1,580,000 (originally 1.615 million units), but 7.4 percent (±13.0 percent)* above the September 2020 SAAR of 1,448,000 units; the not-seasonally adjusted YoY change (shown in the table above) was +7.5%. 

Single-family housing starts in September were at a SAAR of 1,080,000; this is virtually unchanged from (±8.4 percent)* the revised August figure of 1,080,000 units (-2.4% YoY). Multi-family: 475,000 units (-5.0% MoM; +37.8% YoY).

* 90% confidence interval (CI) is not statistically different from zero. The Census Bureau does not publish CIs for the entire multi-unit category.

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Total completions were at a SAAR of 1,240,000 units. This is 4.6 percent (±9.0 percent)* below the revised August estimate of 1,300,000 (originally 1.330 million units) and 13.0 percent (±9.1 percent) below the September 2020 SAAR of 1,426,000 units; the NSA comparison: -14.7% YoY.

Single-family completions in September were at a SAAR of 953,000 units; this is virtually unchanged from (±11.7 percent)* the revised August rate of 953,000 units (+1.3% YoY). Multi-family: 287,000 units (-17.3% MoM; -44.2% YoY).

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Total permits were at a SAAR of 1,589,000 units (1.680 million expected).  This is 7.7 percent (±0.9 percent) below the revised August rate of 1,721,000 (originally 1.728 million units), but virtually unchanged from (±1.1 percent)* the September 2020 SAAR of 1,589,000 units; the NSA comparison: -1.0% YoY. 

Single-family permits were at a SAAR of 1,041,000; this is 0.9 percent (±0.8 percent) below the revised August figure of 1,050,000 (-8.0% YoY). Multi-family: 548,000 units (-18.3% MoM; +15.0% YoY).

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Strong consumer demand helped push builder confidence higher in October despite growing affordability challenges stemming from rising material prices and shortages. Builder sentiment in the market for newly built single-family homes moved four points higher to 80 in October, according to the NAHB/Wells Fargo Housing Market Index (HMI) released today.

“Although demand and home sales remain strong, builders continue to grapple with ongoing supply chain disruptions and labor shortages that are delaying completion times and putting upward pressure on building material and home prices,” said NAHB Chairman Chuck Fowke.

“Builders are getting increasingly concerned about affordability hurdles ahead for most buyers,” said NAHB Chief Economist Robert Dietz. “Building material price increases and bottlenecks persist and interest rates are expected to rise in coming months as the Fed begins to taper its purchase of U.S. Treasuries and mortgage-backed debt. Policymakers must focus on fixing the broken supply chain. This will spur more construction and help ease upward pressure on home prices.”

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.