April Housing Starts: Regained Momentum

• April housing starts rose 5.7% from March and fell 2.5% from a year ago, to 1.24 million units (SAAR) according to the Census Bureau.  Single-family starts climbed 6.2% from March and fell 4.3% from a year ago. Multi-family starts climbed 2.3% from March and 1.4% from a year ago.
• Housing permits rose 0.6% from March but fell 5% from a year ago, driven by multi-family permits, which rose 7.1% from March and 1.5% year-over-year.
• National housing completions dropped 1.4% from March but rose 5.5% from a year earlier.

Housing starts picked up momentum in April following setbacks the past couple months. Builders spotted a clear runway in April, coming on the heels of a March rebound in new home sales and in the midst of low mortgage rates, a robust labor market and none of the barriers presented by this winter’s partial government shutdown or early signs of a trade war with China.

There’s room in the market for more new homes, with housing inventory still low by historical standards and affordability suffering in many markets. Market affordability for builders is a different story: Their costs have risen with too few lots and workers, and material costs remain high.

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