Single-family construction starts climbed higher for the month of July, while permits and completions dropped, according to new residential construction statistics for July 2015 jointly released by the U.S. Census Bureau and HUD.
According to the data, single-family housing starts were at a rate of 782,000 in July, 12.8 percent above the revised June figure of 693,000.
Selma Hepp, Trulia's chief economist weighed in on the new residential data, finding that although single-family starts were up in July, they are still running below historical levels.
"Finally a little bit stronger than multi-family starts, the single-family starts are still below long-run average in most major metros across the county," Hepp said. "In fact, Trulia’s latest study reveals that the single-family component is still well below historical norms even in metros seeing improvement in annualized permit activity. Only 13 out of the 100 largest U.S. metros saw increases in single-family construction over their historical norms, most notably in Austin, Houston, Charleston and Nashville."
The Bureau and HUD reported that single-family authorizations fell in July to a rate of 679,000, 1.9 percent below the revised June figure of 692,000.
"Many housing markets are still building well below their historical norm," Hepp noted. "Trulia’s analysis of permit activity shows that seven in ten homebuilding markets are building below their long-run norm. Most simply, areas with slower home price appreciation and fewer new jobs are still the construction laggers, but also the markets with some residual distressed inventory since the housing bust."
The data also found that single-family housing completions declined in July to a rate of 627,000, 1.4 percent below the revised June rate of 636,000.
David Crowe, chief economist at NAHB noted that renting is expected to stay in high demand as many new household are not able to purchase a home, but "single-family construction will also continue its modest improvement path as more existing home owners gain comfort in their own economic future and earn more equity in their current home to move forward to a new home."
"Builders remain concerned about access to affordable lots and skilled labor," Crowe said. "Attracting more labor and lot development to the industry will require builders to pay more for those supplies and will continue to increase the cost of new homes as existing home values also increase."