Housing Activity Slowed in September but Remains Brisk

Total housing starts fell to a 1.555 million annual rate in September from a 1.580 million pace in August, a 1.6 percent decrease. From a year ago, total starts are up 7.4 percent. Total housing permits also fell in September, posting a 7.7 percent drop to 1.589 million in September from 1.721 million in August. Total permits are at about the same level as they were in September 2020 level.

The dominant single-family segment posted a rate of 1.080 million in September, the same as in August and are down 2.3 percent from a year ago. Single-family permits experienced a 0.9 percent decline to 1.041 million versus 1.050 million in August. Single-family starts and permits have been trending lower from peaks around the start of the year but remain at a historically robust pace (see first chart).

Starts of multifamily structures with five or more units fell 5.1 percent to 467,000 but are still up a robust 38.2 percent over the past year while starts for the two- to four-family-unit segment were unchanged at an 8,000-unit pace.  Combined, multifamily starts were off 5.0 percent to 475,000 in September (see first chart) and show a gain of 38.5 percent from a year ago.

Multifamily permits for the 5-or-more group sank 21.0 percent to 498,000 while permits for the two-to-four-unit category jumped 22.0 percent to 50,000. Combined, multifamily permits were 548,000, off 18.3 percent for the month (see first chart) but up 17.1 percent from a year ago.