According to U.S. Commerce Department data released today, national housing starts rose 3.9% in November from October, the first uptick since August. New home construction is no longer in its hayday of five years ago where builders whipped up over two million houses in a single year, but it’s stable and hovering at roughly 6% year over year.
Builder confidence has remained stable with a small dip in confidence in holiday foot traffic, single family home builders aren’t being held back by low confidence and near impossible funding- single family home building rose 7%, pointing to multi-family building as a continued weak point in housing starts.
The current threat to the new home sector is a dip in permits issued, which fell 4% in November and fell nearly 15% year over year. Is this cause for speculators to worry?
“The modest increase in single-family starts and permits in November is consistent with a very low inventory of unsold new homes and our member surveys that have shown a degree of optimism among builders with regard to sales expectations in the next six months,” said National Association of Home Builders’ Chief Economist David Crowe. “However, builders continue to find it extremely difficult to obtain credit for acquisition, development and construction activities, and this is weighing on their ability to initiate viable new projects that could generate much-needed job growth.”