New construction authorized by permit, housing starts and housing compositions all dropped significantly in April, both month-over-month and annually, according to data released Tuesday by the U.S. Census Bureau.
“This drop in new home construction is not surprising since most states were under stay-at-home orders in April, which included home builders,” Bill Banfield, Quicken Loans’ executive vice president of capital markets, said in a statement.
“While it may seem grim, we know there is light at the end of the tunnel because in May, many states — including our home state of Michigan — began to allow construction,” Banfield added. “This is reassuring since, with home buying expected to bounce back after the country reopens, it is critical builders generate enough new supply to keep up with strong demand.”
Privately owned housing starts were reported at a seasonally-adjusted annual rate of 891,000, which was 30.2 percent below the March estimate and 29.7 percent below the April 2019 rate. Single-family housing starts dropped 25.4 percent month-over-month.
Privately owned housing units authorized by building permits dropped 20.8 percent month-to-month and 19.2 percent year-over-year to a seasonally-adjusted rate of 1,074,000. The single-family sector was hit particularly hard, falling 24.3 percent month-over-month.
Housing completions weren’t as impacted by the COVID-19 crisis, as other metrics were. Privately owned housing completions were down 8.1 percent month-over-month and 11.8 percent year-over-year.