The Census Bureau’s report on new residential construction stated that multifamily permits rose slightly in May. However, multifamily starts fell after three months of gains and multifamily completions steadied after three months of declines. It also reported that single family permits were lower while starts were nearly unchanged and completions rose.
Multifamily permits edge higher
The number of permits issued for buildings with 5 or more units in May was reported to be 444,000 units on a seasonally adjusted, annualized basis. Permit issuance was up 1.4 percent from April’s revised (+7,000 units) figure. Permits were up 13.0 percent year-over-year and were up 2.5 percent from their trailing 12-month average.
In addition, 51,000 permits were issued in May for units in buildings with 2 to 4 units. This was the down 10,000 units from the revised (+2,000 units) figure for April. May permits for units in buildings with 2 to 4 units were down 7.3 percent from the year-ago level and were down 8.3 percent from their trailing 12-month average.
Regional data for multifamily housing is only reported for structures with two or more units. “Structures with 5 or more units” is not broken out as a separate category. Since the regional data is highly volatile and is frequently revised, it is examined here based on three-month weighted moving averages. This averaging helps smooth out the month-to-month variations in the data so that underlying trends are more visible.
Nationally, the three-month weighted moving average for permits issued for multifamily housing in May was up 0.5 percent from the level in April and was up 7.4 percent from its level in May 2024. The three-month weighted moving average for permits came in at 499,000 annualized units.
On a month-over-month basis, the three-month weighted moving average for multifamily permit issuance was up 6.8 percent in the West, 4.2 percent in the Northeast and 0.6 percent in the Midwest. Permit issuance was down 3.7 percent in the South.
When compared to year-earlier levels, the three-month weighted moving average of permits issued was up 30.3 percent in the Midwest, 16.4 percent in the West and 3.7 percent in the South. Permit issuance fell 13.2 percent in the Northeast.
The following chart shows the three-month weighted moving averages of permits by region for the last 37 months. It also shows the un-averaged total number of multifamily permits issued for the country as-a-whole.
Multifamily construction starts plunge
The preliminary May figure for multifamily housing starts in buildings with 5 or more units was 316,000 units on a seasonally adjusted, annualized basis. Starts were reported to be down 30.4 percent (138,000 units) from the revised (+34,000 units) figure for April.
Compared to the year-earlier level, multifamily housing starts in buildings with 5 or more units were up 5.0 percent. The reported starts figure was 10.8 percent below its trailing 12-month average.
Multifamily housing construction starts (two or more units per building) in May were down 10.5 percent from their April level for the country as-a-whole, based on three-month weighted moving averages. Starts fell 20.9 percent in the Northeast, 13.9 percent in the Midwest, 6.5 percent in the West and 6.4 percent in the South.
The three-month weighted moving average of starts was up 24.3 percent for the country-as-a-whole on a year-over-year basis. Compared to year-earlier levels, starts were up 111.8 percent in the Northeast, 65.9 percent in the Midwest and 17.8 percent in the South. Starts fell 14.9 percent in the West.
The following chart shows the three-month weighted moving average of starts by region for the last 37 months. It also shows the un-averaged total number of multifamily starts for the country as-a-whole.
Multifamily housing completions higher after revisions
The preliminary May figure for multifamily housing unit completions in buildings with 5 or more units per building was 487,000 units on a seasonally adjusted, annualized basis. Completions were reported to be up 0.2 percent (1,000 units) from the revised (-21,000 units) level of the month before.
Compared to the year-earlier level, multifamily housing completions in buildings with 5 or more units per building were down 6.7 percent. Completions were 16.3 percent below their trailing 12-month average.
For the country as-a-whole, multifamily completions (two or more units per building) were down 2.0 percent month-over-month, comparing three-month weighted moving averages. The three-month weighted moving average of completions was up 14.3 percent in the Northeast, 3.8 percent in the Midwest and 3.7 percent in the West. Completions fell 12.2 percent in the South.
On a year-over-year basis, the three-month weighted moving average of completions in buildings with 2 or more units per building was down 6.5 percent nationally. Completions were up 115.9 percent in the Northeast and 2.9 percent in the West, but completions fell 23.4 percent in the South, and 30.6 percent in the Midwest.
The three-month weighted moving average of completions by region for the past 37 months are shown in the chart below. It also shows the un-averaged total number of multifamily completions for the country as-a-whole.
Census reported that there were 733,000 units under construction in buildings with 5 or more units per building on a seasonally adjusted annualized basis. This was reported to be down by 11,000 units from the revised (+11,000 units) level of the month before. It is 18.9 percent, or 171,000 units, lower than the number of units under construction one year earlier.
Single-family starts rise
The report on single-family housing construction showed that, on a seasonally adjusted basis, single family permits fell 2.7 percent month-over-month and 6.4 percent year-over-year to 898,000 units. Starts rose 0.4 percent month-over-month but fell 7.3 percent year-over-year from last month’s revised (-7,000 units) level to 924,000 units. Completions were reported to be up 8.1 percent and 0.1 percent year-over-year from last month’s revised (+7,000 units) level to 1,027,000 units. The reported number of single-family units under construction was down 8,000 units from the revised (+1,000 units) level of the month before at 623,000 units.
All data quoted are based on seasonally adjusted results and are subject to revision.
