The National Association of Home Builders, www.nahb.com, reported that housing starts nationwide rose 15 percent in September 2011, to a seasonally adjusted annual rate of 658,000 units, marking the strongest growth in residential construction since April 2010, according to figures released by the U.S. Commerce Department.
Single-family housing starts rose 1.7 percent during the same period to a seasonally adjusted annual rate of 425,000 units. The overall gain was largely attributed to a sharp rise in multifamily homes, thanks to to increased demand for rental apartments. Multifamily starts, which often display substantial swings from month-to-month, rose 51.3 percent to a seasonally adjusted annual rate of 233,000 units, the highest level since October 2008.
"Today's numbers are very welcome evidence that builders are putting some crews back to work on single-family homes in select markets where economic conditions are improving, and on multifamily homes in places where demand for rentals is on the rise," said Bob Nielsen, chairman of the National Association of Home Builders. "That said, extremely tight lending conditions for both building and buying new homes, along with stubbornly high foreclosures that are putting downward pressure on home prices, continue to weigh down new construction and corresponding job growth."
Nielsen also noted that for every one new single-family home built in the United States, three new full-time jobs are created.
"The big gain in multifamily housing production for September was in the wake of a below-trend number in August and in keeping with characteristic volatility in that sector. However, there's no doubt that demand for apartments is rising as restrictive mortgage lending policies and concerns about future employment push consumers to pursue rental options," said NAHB Chief Economist David Crowe. "Single-family starts showed a slight uptick for the month, which was right in line with our forecast for the third quarter and in keeping with what builders have been telling us in recent surveys regarding the emergence of improving conditions in select local housing markets."
Building permits fell 5 percent to a seasonally adjusted annual rate of 594,000 units in September 2011, down from a large gain in the previous month. Single-family permits remained nearly unchanged at 417,000 units, while multifamily permits declined 14.5 percent to 177,000 units.
Regionally during the same period, housing starts gained 12.7 percent in the Northeast, 9.3 percent in the Midwest, 15.7 percent in the South and an 18.1 percent in the West. Regionally, building permit activity was mixed, with gains of 4.9 percent in the Northeast and 0.9 percent in the Midwest, but declines of 7 percent in the South and 9 percent in the West.