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Lower Interests Rates Create Surge in Single-Family Home Construction12-21-23 | Economic News

Lower Interests Rates Create Surge in Single-Family Home Construction

18% Increase in Single-Family Housing Starts in November
by Staff

Single-family housing starts soar in November, rising 18%, fueled by lower mortgage rates and strong demand.

The U.S. Department of Housing and Urban Development and the U.S. Census Bureau report an overall 14.8% increase in housing starts in November compared to the previous month, reaching a seasonally adjusted annual rate of 1.56 million units. Single-family units led the rise in starts at 18% higher than October.

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Despite the surge, single-family starts are down by 7.2% year-to-date. While the multifamily sector, encompassing apartments and condos, rose by 6.9% annual. "The single-family starts figure is remarkably strong, and we would not be surprised to see this figure revised lower or fall back slightly in the next month, given the nearly 20% rise in November." NAHB Chief Economist Robert Dietz cautioned.

Looking ahead, NAHB forecasts an approximate 4% gain for single-family starts in 2024, anticipating lower mortgage rates, slowing economic growth, and decreasing inflation. However, builders continue to grapple with elevated construction and regulatory costs amidst the positive momentum.

https://www.nahb.org/news-and-economics/press-releases/2023/12/single-family-starts-surge-on-falling-interest-rates

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