Housing Starts Up 6.2% M/M But Single-Family Down 9% Signals Weakness
December housing starts rose 6.2% month-over-month to 1.40 million SAAR but remain down 7.3% year-over-year, while single-family starts plunged 9% to 981,000 units. Total permits edged up 4.3% M/M, yet single-family permits fell 10.9% Y/Y even as multifamily permits jumped 15.5%, highlighting sector weakness.
1. Monthly Housing Starts Data
December housing starts reached a seasonally adjusted annualized rate of 1.40 million, a 6.2% M/M gain, but remain 7.3% below last year’s level, reflecting lingering downward pressure on overall construction activity.
2. Single-Family vs Multifamily Trends
Single-family starts, which account for roughly 70% of total, slid 9% Y/Y to 981,000 units, while multifamily starts posted a monthly rebound yet stayed down 3% on an annual basis, underscoring uneven segment performance.
3. Permit Indicators Point to Softness
Total building permits climbed 4.3% M/M, but single-family permits dropped 10.9% Y/Y even as multifamily permits surged 15.5%, suggesting the single-family pipeline remains strained and may weigh on future starts.
4. Outlook and Forecast
Builder confidence fell to 36 versus a long-term average of 51, over one-third of builders cut prices and 65% offered incentives; single-family starts are projected to decline 2% in 2026 before a modest 2% rebound in 2027.