Builders may be down, but they’re not out. While housing starts dropped 4.3% in December, according to data released today by the U.S. Census Bureau and HUD, permits rose 16.7% from November's numbers, although that number remains 6.8% below what it was in December 2009.
The multifamily sector fared better than single units, with starts 17.9% above the previous month and permit numbers that looked particularly bright: Structures of five units or more climbed 60.7% over November’s numbers. Multifamily units overall reached an annualized rate of 195,000, the highest total since January 2009.
While single-family starts tumbled 9% from November and were 14.2% below the December 2009 number, permits gained 5.5% from November for an annualized rate of 440,000 units. That number, however, remains 14.9% below the previous year. The Northeast led with a 50% increase in permits over the previous month. The West came in second with a 18.5% rise, while both the South and Midwest fell behind, decreasing 1.9% and 16.9%, respectively.
Patrick Newport, U.S. economist at IHS Global Insight, emphasized in a press release that permits are the more important indicator of the industry’s pulse, pointing to December’s snow and colder-than-average weather to explain the month’s poor showing in starts. And he’s likely right, considering the areas that suffered most from Mother Nature’s fury also had the largest dips in total start numbers: the Northeast was down 24.7%, the Midwest was down 38.4%, and the South dropped 2.2%. Meanwhile, the West gained 45.8% in new-home starts.
Claire Easley is senior editor, online, for Builder.