New Housing Starts Exceed Expectations

Posted by John Sabia on Friday, October 23rd, 2015 at 11:49am.

Even with recent volatility in the economy as a whole, the real estate housing market still shows to be strong and healthy. New home construction - which is generally a good indicator of the real estate market’s overall health was up 6.5 percent in September and is currently 17.5 percent higher than last year.

The numbers from September far exceeded expectations from economists and for six straight months, housing starts continued to be higher than an annual rate of one million units, which is a strong signal for a healthy market. However with the improvements in real estate construction, single-family homes were mostly flat from the month before, with both construction starts and permits almost unchanged.

Therefore, most of the improvements for the month were a result of the multi-family market, which is being sparked by a continued demand for rentals.

All in all, this is encouraging news indicating a healthier employment market and favorable affordability conditions are helping to free up pent-up demand for real estate. In the South, the number of housing starts in the month of September reached a top level not seen since October 2007. The West region also achieved 8-year highs. More about this here.

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John Sabia

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