Led by demand for single-family homes, U.S. housing starts inched up 0.2 percent to a seasonally adjusted annual rate of 1.206 million units in July, the highest level since October 2007 when the housing market was on the eve of a meltdown.
The newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department suggests a strengthening market which would help extend the economic expansion.
“Our builders are reporting more confidence in the market, and are stepping up production of single-family homes as a result,” said National Association of Home Builders Chairman Tom Woods, a home builder from Blue Springs, Mo. “However, builders are still reporting problems accessing land and labor.”
Approved building permits decreased 16.3 percent in July to an annual rate of 1.12 million, after achieving an eight-year high in June. Single-family permits dipped 1.9 percent to a rate of 679,000 while multifamily permits dropped 31.8 percent to 440,000.
July’s drop in the more volatile multifamily side is “a return to trend” after an unusually high June, said NAHB Chief Economist David Crowe.
“While multifamily production has fully recovered from the downturn, single-family starts are improving at a slow and sometimes intermittent rate as consumer confidence gradually rebounds,” Crowe said. “Continued job and economic growth will keep single-family housing moving forward.”