Steel Markets

NAHB: Housing Starts Slip in October

Written by David Schollaert

November 18, 2021

Housing starts slipped 0.7% in October as single-family housing production lagged, hampered by supply-chain shortages and limited access to labor and lots. Overall housing starts decreased to 1.52 million units, seasonally adjusted, according to the latest data from the U.S. Census Bureau and the Department of Housing and Urban Development.

construction3The October reading of 1.52 million includes single-family starts, which fell 3.9% to a 1.04 million seasonally adjusted annual rate, but remain up 16.7% year-to-date. The multifamily sector, which includes apartment buildings and condos, increased 7.1% to an annualized 481,000 pace.

Due to supply-chain bottlenecks, 152,000 single-family units are authorized but have not started construction – up 43.4% from a year ago, said the NAHB.

“The rising count of homes permitted but that have not yet started construction is a stark reminder to policymakers to fix the supply chain so that builders can access a steady source of lumber and other building materials to keep projects moving forward,” said Chuck Fowke, NAHB’s chairman.

On a regional and year-to-date basis through October versus the same period last year, combined single-family and multifamily starts are 30.2% higher in the Northeast, 10.7% higher in the Midwest, 15.2% higher in the South and 20.4% higher in the West.

“Single-family permit data has been roughly flat on a seasonally adjusted basis since June due to higher development and construction costs,” said Robert Dietz, NAHB’s chief economist. “Demand remains solid, but housing affordability is likely to decline in 2022 with rising interest rates.”

Overall permits increased 4.0% to a 1.65-million-unit annualized rate in October. Single-family permits increased 2.7% to a 1.07-million-unit rate. Multifamily permits increased 6.6% to an annualized pace of 581,000.

Looking at regional permit data on a year-to-date basis, permits are 14.4% higher in the Northeast, 17.2% higher in the Midwest, 20.4% higher in the South and 23.0% higher in the West.

David Schollaert

David Schollaert is deputy editor-in-chief for Steel Market Update. David joined SMU after more than a decade in the metals and mining industry in a myriad of different roles. Much of his early experience and expertise were within the coverage and analysis of steel-making raw materials and served previously as senior editor of the CRU Prices Service. Most recently, however, before his return to market analysis, David held roles as a metals buyer and an operations manager for raw material suppliers. He can be contacted at david@steelmarketupdate.com or 724-720-1008.

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