A Million Reasons to Smile About Latest New-Home Production Figures
December 20th, 2013 by
Builders should be feeling more than holiday cheer thanks to numbers released Wednesday by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau. Nationwide housing production increased by 22.7 percent in November to a seasonally adjusted annual rate of 1.09 million new homes.
While the overall figures are certainly encouraging, single-family starts deserve the most attention. With a 20.8 percent gain, single-family starts hit a seasonally adjusted annual rate of 727,000 units in November, the fastest rate since December 2007. Multifamily production also rose 26 percent to 364,000 units.
Regionally, the Midwest is leading the charge with a 41.7 percent spike in start activity, followed closely by the South (38.5 percent) and West (8.8 percent). Production was down 29.4 percent in the Northeast.
In a statement released by the National Association of Home Builders on Wednesday, Chairman Rick Judson said,
“This report is in line with our latest survey, which shows that builders are increasingly confident that buyers who have sat on the sidelines are feeling more secure about their economic situation and are now moving to purchase new homes. This upward trend could be even stronger if not for persistently tight lending conditions for buyers and builders facing rising costs for building materials, lots and labor.”
David Crowe, chief economist for the NAHB added, “We hit a soft spot this fall when interest rates jumped and the government closed down, but mortgage rates still remain very affordable and pent-up demand is helping to boost the housing market. We expect a continued steady, gradual growth in starts and home sales in 2014.”