Housing Starts fall back in August

Summary

Residential construction under pressure

Overall housing starts slipped by 8.5% in September, driven by declines in both single-family and multifamily starts. A downtrend in single-family starts remains the largest drag as builders try to right-size elevated inventory amid a weak demand environment. But multifamily starts also retreated substantially, coinciding with a descent in the number of apartments under construction to the lowest level since August 2021.

Perhaps more telling, overall housing permits retreated by 3.7% in August, the fifth consecutive decline. An ongoing slide in single-family permits and recent weakness in multifamily permits suggest that residential construction is likely to trail even lower in the months ahead.

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