The Census Bureau’s new residential construction report stated that multifamily permits jumped higher in November but both starts and completions were sharply lower month-over-month.
Multifamily permits rebound
The number of permits issued for buildings with 5 or more units in November was reported to be 481,000 units on a seasonally adjusted, annualized basis. Permit issuance was up 22.1 percent from October’s revised (+1,000 units) figure. Permits were up 4.8 percent from their year-earlier level and were also up 11.1 percent from their trailing 12-month average.
In addition, 52,000 permits were issued in November for units in buildings with 2 to 4 units. This was down 2,000 units from the revised (-1,000 units) figure for October. November permits for units in buildings with 2 to 4 units were up 4.0 percent from the year-ago level but were down 2.5 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 November was up 6.7 percent from the level in October but was down 25.3 percent from the level of November 2023. The three-month weighted moving average for permits came in at 493,000 annualized units.
On a month-over-month basis, the three-month weighted moving average for multifamily permit issuance was up 17.1 percent in the Northeast, 10.0 percent in the Midwest, 5.3 percent in the West and 2.6 percent in the South.
When compared to year-earlier levels, the three-month weighted moving average of permits issued was up 19.2 percent in the Northeast and 15.0 percent in the Midwest. Permit issuance fell 8.0 percent in the South and 25.3 percent in the West.
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 lower
The preliminary November figure for multifamily housing starts in buildings with 5 or more units was 264,000 units on a seasonally adjusted, annualized basis. This was reported to be down 24.1 percent (84,000 units) from the revised (+22,000 units) figure for October. In addition, the September starts figure was revised lower by 2,000 units to 295,000 units.
Compared to the year-earlier level, multifamily housing starts in buildings with 5 or more units were down 28.8 percent. The reported starts figure was 23.9 percent lower than the trailing 12-month average.
Multifamily housing construction starts (two or more units per building) in November were down 10.1 percent from their October level for the country as-a-whole, based on three-month weighted moving averages. Starts rose 18.4 percent in the Northeast and 0.2 percent in the West. Starts fell 17.1 percent in the South and 29.3 percent in the Midwest.
The three-month weighted moving average of starts was down 19.6 percent for the country-as-a-whole on a year-over-year basis. Compared to year-earlier levels, starts were up 52.5 percent in the Northeast but down 17.9 percent in the West, 22.3 percent in the Midwest and 35.1 percent in the South.
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 also down
The preliminary November figure for multifamily housing unit completions in buildings with 5 or more units per building was 544,000 units on a seasonally adjusted, annualized basis. Completions were reported to be down 11.1 percent (68,000 units) from the revised (-3,000 units) level of the month before. In addition, the September completions figure was revised 24,000 units lower to 652,000 units.
Compared to the year-earlier level, multifamily housing completions in buildings with 5 or more units per building were up 13.6 percent. Compared to the trailing 12-month average, completions were down 5.3 percent.
For the country as-a-whole, multifamily completions (two or more units per building) were down 8.5 percent month-over-month, comparing three-month weighted moving averages. The three-month weighted moving average of completions was up 32.3 percent in the Northeast but down and 9.7 percent in the South, 19.4 percent in the West and 23.1 percent in the Midwest.
On a year-over-year basis, the three-month weighted moving average of completions in buildings with 2 or more units per building was up 30.8 percent nationally. Completions were up 177.6 percent in the Northeast, 48.5 percent in the West and 8.2 percent in the South. Completions fell 9.3 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.
The number of multifamily units reported to be under construction continued its downward trend in November. Census reported that there were 780,000 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 45,000 units from the revised (-23,000 units) level of the month before. It is 20.9 percent, or 206,000 units, lower than the number of units under construction one year earlier.
Single-family completions outpace starts
The report on single-family housing construction showed that, on a seasonally adjusted basis, single family permits rose 0.1 percent month-over-month but fell 2.7 percent year-over-year to 972,000 units. Starts fell 6.4 percent month-over-month and 10.2 percent year-over-year from last month’s revised (-20,000 units) level to 1,011,000 units. Completions were up from last month’s revised level, rising 1.9 percent month-over-month and 7.0 percent year-over-year to 1,038,000 units. The reported number of single-family units under construction was down 0.8 percent from the revised (-2,000 units) level of the month before at 637,000 units.
All data quoted are based on seasonally adjusted results and are subject to revision.
