Housing starts continued their trend of annual increases in September, but fell sharply from last month’s boom, according to the latest data from the U.S. Census Bureau and U.S. Department of Housing and Urban Development.
Privately owned housing starts increased 1.6 percent year-over-year in September, but fell 9.4 percent from August. The biggest difference, however, was the multi-family sector, because single-family housing starts actually increased 0.3 percent, month-over-month.
“After August’s numbers came in strongly, September was a step back for housing starts,” John Pataky, executive vice president at TIAA Bank, said in a statement. “Despite mortgage rates remaining low, buyers did not seem incentivized enough to come off the sidelines. Additionally, housing prices have been creeping back up again in line with growing demand.”
Privately owned housing units authorized by permits ticked up 7.7 percent year-over-year but fell 2.7 percent from last month. Housing completions fell 1 percent year-over-year and 9.7 percent month-over-month.
“The picture in housing is not all negative: earnings season so far has highlighted the continued strength of American consumers, who are carrying the economy on their backs despite all the uncertainties around growth and rates,” Pataky said. “Heading into the fourth quarter, we will have to see if consumers have the stamina to keep spending on large purchases such as new homes, as they will be a key driver behind the rise or fall of the housing market in the coming months.”