Housing construction recovered in March after a sharp decline in the previous month. The US Census Bureau and the Department of Housing and Urban Development said all three measures have increased. with living begins to reach a 15-year high. Some regional increases were over 100 percent.
Housing permits were issued in March at a seasonally adjusted annual rate of 1.766 million, up 2.7 percent from February’s 1.720 million rate. The latter is an upward revision of the 1.682 million permits originally reported for February, erasing part of the nearly 11 percent originally reported loss. The approval rate for the month was 30.2 percent higher than in March 2020.
There was some disagreement among the analysts surveyed Econoday and Commercial economics in forecasting the results for the month and both missed the mark. Econoday’s consensus was 1.620 million permits Commercial economics placed it at 1.75 million, the high end of Econoday’s Range.
Single family permits were issued at an annual rate of 1.199 million, an increase of 4.6 percent from the previous month and 35.6 percent more than the rate last year. Multi-family permits at a rate of 508,000 declined 3.6 percent from February but rose 19.2 percent annually.
On an unadjusted basis, 158,300 permits were issued, compared to 120,100 in the previous month. Single family permits were 110,800, up from 81,100 in February.
For the current year (YTD), 406,300 permits have been issued, 275,700 for single-family homes and 118,300 for units in buildings of five or more. So far the relative numbers in 2020 have been 329,400, 220,400 and 98,700.
US builders began building housing units at a seasonally adjusted annual rate of 1.739 million units. It was the highest production rate since June 2006 and a 19.4 percent increase from the February revised rate (out of 1.421 million) out of 1.457 million. It beat starts in March 2020 by 37.0 percent.
Consensus estimates for home starts were also low. Commercial economics had a consensus forecast of 1.613 million while Econoday’s Analysts forecast 1.750 million.
The number of single-family homes rose by 15.3 percent to 1.238 million, 40.7 percent more than in the previous year. The February estimate of 1,040 million has been revised to 1,074 million. The multi-family starts rose from month to month by 30 percent and annually by 26.9 percent to 477,000 units.
Unadjusted, 144,400 residential units were put into operation in March, compared to 103,100 in February. The number of single-family houses is 103,700 and 74,800 respectively.
So far there have been 362,700 new homes in 2021 compared to 329,200 in the first three months of 2020. The number of single-family homes rose from 214,400 to 256,500, while the number of multi-family homes fell from 111,800 to 102,000.
Lawrence Yun, Chief Economist for the National Association of Realtors®, said the following about the housing construction report. “The shortage of real estate stocks has pushed prices up, but also slowed home sales. In almost all markets 20 percent more inventory means 20 percent more house sales. Today’s news of the rise in new residential construction is therefore very welcome, especially given the major challenges in terms of material costs and rising wood prices. After 13 consecutive years of underproduction – the main cause of today’s storage shortage – this construction boom must last at least three years to make up for the past shortage. When trade-up buyers buy newly built homes, their previous homes are displayed in MLSs, giving consumers more choice. The start of construction to the completion of the living space can take 4 to 8 months. So be patient with the inventory improvement. Meanwhile, construction workers deserve applause. “
Completions rose by 16.6 percent from February to 1.580 million annual units, including 1.099 million single-family houses. The completion rate is 23.4 percent higher than in March 2020, the completion of single-family homes by 21.1 percent. Apartment buildings were completed at a rate of 476,000 units, an increase of 58.1 percent over the previous month and an increase of 30.4 percent over the previous year.
The number of unadjusted completions was 126,400, up from 94,700 in February, and 88,400 single-family homes were put into operation, up from 74,000 in the previous month. The builders have completed 314,700 residential units since the beginning of the year, compared with 282,700 at the same time in the previous year. Completion of single-family homes rose 14.1 percent to 234,600, and 78,800 apartment buildings were also completed, an increase of 4.9 percent.
At the end of March, 1.306 million residential units were under construction, of which 636,000 were single-family houses. In addition, 217,000 permits were issued for construction work that has not yet started. The single family population was 124,000.
Permits in the Northeast decreased by 8.0 percent compared to the previous month, but increased by 42.9 percent annually. The launches increased by 64.0 percent from February and by 116,700 compared to the previous year. Completions rose by 30.3 percent and 82.1 percent over the course of the month and year.
Middle West The approval rate increased by 2.0 percent, an increase of 46.0 percent compared to March 2020. The launches increased 122.8 percent and 87.0 percent in both periods. Completions rose by 17.6 percent in the course of the month and by 12.4 percent in the course of the year.
Permission in the south rose in the course of the month by 6.4 percent and compared to the previous month by 26.6 percent. There were 13.5 percent more launches in March than in February, up 24.0 percent year over year, and completions rose 16.9 percent and 22.5 percent, respectively.
The approval remained unchanged west from a month earlier, but was 25.9 percent a year earlier. Starts were down 13.6 percent from February, but were 19.5 percent higher than in March. Completions rose by 10.5 percent in the course of the month and by 17.7 percent annually.