Housing starts and building permits in August dropped to the lowest rate since June 1995, the U.S. Census Bureau and Department of Housing and Urban Development announced today.
The seasonally adjusted annual rate of building permits dropped to an estimated 1.31 million in August, down 24.5 percent compared to August 2006, and the rate of housing starts fell 19.1 percent to 1.33 million. This rate is a projection of a monthly total over a 12-month period, adjusted for seasonal fluctuations in construction activity.
The rate of single-family building permits dropped about 27.9 percent in August compared to the same month last year, to 926,000. This was the lowest rate since April 1995. And the rate of single-family housing starts dropped 27.1 percent in August compared to August 2006, falling to the lowest level since March 1993.
Building-permit authorizations of units in buildings with five units or more fell about 12 percent to a rate of 324,000 in August compared to the same month last year, while housing starts for buildings with five or more units rose an estimated 23.9 percent.
Regionally, the rate of building-permit authorizations dropped an estimated 28.2 percent in the South, 27.6 percent in the Midwest, 20.1 percent in the West and 10.7 percent in the Northeast in August compared to that month last year.
And the rate of housing starts dropped about 39.2 percent in the Northeast, 31.6 percent in the West, 15 percent in the South and 0.8 percent in the Midwest, the agencies reported.
Housing completions in August dropped 19 percent compared to August 2006, to a seasonally adjusted annual rate of 1.52 million. Single-family housing completions fell 23 percent year-over-year in August, to a rate of 1.25 million. The August rate of completions for units in buildings with five or more units was 254,000, up 9 percent compared to August 2006.
The agencies noted that month-to-month changes in seasonally adjusted statistics can show irregular movements, and it may take three months to establish an underlying trend for building-permit authorizations, four months for total starts, and six months for total completions.
Statistics are estimated from sample surveys and are subject to sampling variability and errors including bias and variance from response, nonreporting, and undercoverage.
On average, the preliminary seasonally adjusted estimates of total building permits, housing starts and housing completions are revised about 1 percent, according to the report.