Comments on July Housing Starts

by Calculated Risk on 8/18/2021 10:29:00 AM

Earlier: Housing Starts decreased to 1.534 Million Annual Rate in July

Total housing starts in July were above expectations, however starts in May and June were revised up slightly

Single family starts increased in July, and were up 12% year-over-year. Starts declined at the beginning of the pandemic, and then increased due to strong demand.

The volatile multi-family sector is down 16% year-over-year.

The housing starts report showed total starts were down 7.0% in July compared to the previous month, and total starts were up 2.5% year-over-year compared to July 2020.

The first graph shows the month to month comparison for total starts between 2020 (blue) and 2021 (red).

Click on graph for larger image.

Starts were up 2.5% in July compared to July 2020. The year-over-year comparison are more difficult starting in the second half of 2021.

In 2020, starts were off to a strong start before the pandemic, and with low interest rates, and little competing existing home inventory, starts finished 2020 strong.

Starts were solid in the first half of 2021.

The second graph shows starts under construction, Not Seasonally Adjusted (NSA).

Red is single family units. Currently there are 711 thousand single family units under construction (NSA). This is the highest level since 2006.

Blue is for 2+ units. Currently there are 686 thousand multi-family units under construction. Last month, at 691 thousand units, was the most since 1974.

Combined, there are 1.397 million units under construction. This is the most since July 2006.