Residential housing starts fell 3.6 percent to a rate of 1,567,000 in January while housing completions dropped 3.3 percent, to a rate of 1,280,000. New construction authorized by permits, meanwhile, rose by 9.2 percent, to 1,551,000.
U.S. Census Bureau
“The latest month’s decline in housing starts is nothing to be concerned about,” said Lawrence Yun, NAR’s chief economist, in a prepared statement. “This housing data is quite jumpy. What is important is the trend line, which is clearly on an upward path. Higher housing permit issuances are also a positive indicator for even greater production in the months ahead.
While the numbers dipped modestly in January, they remain significantly higher than last year. Building permits are 9.2 percent higher than they were in December and 17.9 percent higher year-over-year.
Housing starts are 21.4 percent higher than they were in January 2019 while housing completions are 1.5 percent higher year-over-year.
“Housing starts were much higher compared to a year earlier, which is a sign that housing shortages could ease in some markets when those homes are completed,” Holden Lewis, Home and Mortgage Expert at NerdWallet said in a prepared statement. “Note that I’m not saying housing shortages will end — just that they might be less bad.”