Housing Starts, Permits End 2015 Up More Than 10%

Despite a 3.3% drop in housing starts and 3.9% drop in permits issued in December, total starts for 2015 jumped 10.8% while permits rose 12% for the year

January 20, 2016

National Association of Home Builders (NAHB)

Total US housing starts in December, at 1.15 million units, were down 2.5%, but starts over the entire fourth-quarter 2015 were 7.4% above Q4 2014. Permits were down in December, too, 3.9%. But there were 12.3% more permits issued in Q4 2015 than in the same quarter of 2014.

Nationwide housing starts increased 10.8% to 1.11 million units in 2015, according to newly released figures from HUD and the U.S. Commerce Department. Single-family starts posted a yearly gain of 10.4% to 715,000 units.

“These numbers are in line with what our members are telling us that housing markets are improving, but lot and labor shortages continue to be a problem for many builders,” said National Association of Home Builders (NAHB) Chairman Tom Woods, a home builder from Blue Springs, Mo.

“The gradual increase in housing production for 2015 mirrors our forecast and sets the stage for continued growth in 2016,” said NAHB Chief Economist David Crowe. “Strong job growth, rising consumer confidence and pent-up demand will keep housing on an upward trend.”

Crowe forecasts U.S. housing starts to increase 136,000 units, about 12%, in 2016, making this year the best since 2007.

In December, single-family starts fell 3.3% to 768,000 units from an upwardly revised November reading of 794,000 units. Except for November, this was the highest monthly total for single-family housing starts in 2015. Meanwhile, multifamily starts in December fell 1% to 381,000 units.

Despite December declines, housing starts across the fourth quarter of 2015 were 7.4% greater than the same quarter of 2014.

Regionally in December, combined single-family and multifamily starts rose 24.4% in the Northeast but fell 12.4% in the Midwest, 3.3% in the South and 7.6% in the West.

Overall permit issuance increased 12% to 1.178 million units in 2015. Permit issuance in December fell 3.9% to 1.232 million units. Single-family permits increased 7.9% to 691,000 units while multifamily permits fell 11.4% to 492,000 units.