The Census Bureau released its monthly new residential construction report for August, 2018. The report shows declines in multifamily housing permits and completions but and uptick in multifamily housing starts.
Fewer permits are issued
Nationally, permits for buildings with 5 or more units were down, falling 8.0 percent from July’s level, which was itself revised down by 8000 units. Permits came in at 370,000 on a seasonally adjusted, annualized basis. This figure was 19.7 percent lower than its level in August, 2017.
Permitting activity for housing with multiple (two or more) units was down on a year-over-year basis in all regions of the country of the country. The West again led the way with a decline of 41.9 percent while the Northeast and South saw declines of only about 2 percent. On a month over month basis, permits were up 8.8 percent in the South but were down in the rest of the country, falling 24.6 percent in the Northeast and 16.4 percent in the West.
These changes are illustrated in the first chart, below.
Multifamily housing construction starts rebound
Construction starts for buildings with 5 or more units were up a strong 27.3 percent from a soft July figure to a level of 392,000 on a seasonally adjusted, annualized basis. Starts in both June and July were themselves revised upwards from the levels previously reported. Construction starts in August for buildings with 5 or more units were up 37.1 percent from their very weak levels of a year earlier.
Construction starts for housing with multiple units were up strongly from July, 2018 in all regions of the country. The Midwest led the way with a gain of 89.7 percent. The South saw the smallest increase on a percentage basis with starts up 15.6 percent. However, since the South is the region with the most construction activity, the gain in the number of units started there, 27,000, almost matched the gains in the other regions. On a year-over-year basis, starts in the South were up by 92.3 percent compared to a very weak August, 2017. Starts were also up strongly in the Midwest but were flat in the Northeast and down slightly in the West.
The following chart shows the starts by region for the last 12 months.
Completions fall
Nationally, completions of buildings with 5 or more units were down from a July level that was revised downward from last month’s report. On a month-over-month basis, completions fell by 18.6 percent to a level of 285,000 units. On a year-over-year basis, completions were down by 15.4 percent.
Completions for housing with multiple units eked out a small gain of 1.9 percent in the Midwest but fell between 17 percent and 28 percent in the other regions of the country. The situation was similar on a year-over-year basis, with the Midwest showing a small increase but the other regions showing significant declines in the number of completions.
Completions by region for the past year are shown in the chart below.
All data quoted are based on seasonally adjusted results and are subject to revision.
