U.S. custom home builders began construction on houses at an annual rate of 1.67 million by the end of last year. The figure represented a 5.8% increase from the past month’s numbers, as per the report released by the U.S. Census Bureau.
Meanwhile, the permits for new houses happened at an annual rate of 1.71 million, which marks a 4.5% increase. Housing starts increased by 5%, while permits marked a rise of 17%. It was by far the highest permits and housing starts recorded since 2006.
Both of these numbers were higher than the figures expected by industry analysts, which reflected a growth in the single family custom home sector. Meanwhile, economists anticipated housing starts to happen at a rate of 1.56 million while building permits to occur at 1.61 million.
The growth in this sector propelled the increase in building permits and housing starts. In terms of months, single family starts increased by 12% while permits were up 7.8%. Meanwhile, multifamily constructions dropped by 15.2% while permits in at least five units decreased by 2%. Permits for building duplexes, triplexes, as well as quadplexes fell by 11.5%.
Regionally, all areas of the country saw rise in permitting activity except for the Northeast wherein a decrease of 7.2% was noted. But even in that area, permits for single family homes were higher on a monthly basis.
There’s also a drop in housing starts not only for single family homes but the entire sector. Meanwhile, the Midwest saw the biggest increase in housing starts, which stood at 32%.
The big picture shows that the buyer’s demand is cooling off because of the lack of inventory and high house prices. However, the figures are still high compared to the previous years. That offers builders with a strong incentive to keep on building.
In general, housing starts for the past year marked a 12% increase from the previous year even with the slowdown because of the pandemic. The optimism of builders may be waning a bit because of the slow foot traffic and the increasing costs linked to purchasing materials and land. However, the underlying need for brand new homes remains, which must keep the building sector busy down the road.
There’s also an increase in new mortgage applications as buyers try to get ahead of the increase in interest rates. Even with the slow growth in population, the custom home building is still well supported.
Housing starts have bounced back and were at its strongest in nearly 15 years. It’s performance is amazing despite the pandemic. There’s not enough houses in the country and there should be a long lasting increase in construction by custom home builders Myrtle Beach in order to meet this demand.
Call Dawol Homes now if you are looking for a custom home builder who can help you with the construction of your dream house.