Builders broke ground on fewer new homes last month than in January, and a downturn in single-family permits points to more weakness to come.
According to numbers from the Census Bureau and HUD, privately owned housing starts in February were at a seasonally adjusted annual rate of 907,000, down 0.2 percent from January’s revised estimate of 909,000 and 6.4 percent below the February 2013 rate of 969,000.
January’s start activity was originally estimated at a rate of 880,000.
On just the single-family side, builders started work last month at a rate of 583,000 homes per year, 0.3 percent above January’s revised figure.
Meanwhile, total permit issuance was at a rate of 1.02 million in February, a 7.7 percent gain over January and 6.9 percent increase year-over-year. However, all of that increase came from the multifamily segment: Single-family authorizations last month came at a rate of 588,000, a drop of 1.8 percent month-over-month.
The latest report reflects weakness in a month that saw builder confidence plunge back down below the “neutral” mark and into pessimistic territory. According to the National Association of Home Builders’ (NAHB) Housing Market Index (HMI) from last month, confidence levels dropped all around as builders found less to be optimistic about for current sales, sales expectations, and prospective buyer traffic.
The March HMI, released Monday, showed a slight bounce up to a reading of 47 as respondents show continued concerns over lot and labor shortages and doubts about their ability to meet demand in the future.