Single-Family Starts Drop 9% to 981,000, Permits Fall 10.9%, ETF Outlook Weakens
December 2025 housing starts rose 6.2% month over month to 1.40 million SAAR but remain down 7.3% year over year, driven by a 9% drop in single-family starts to 981,000 units. Permits show single-family approvals down 10.9% year over year despite a 15.5% multifamily jump, while the NAHB confidence index fell to 36 and an analyst forecasts total starts sinking to 1.37 million in 2026, pressuring housing ETFs.
1. December Housing Starts Trends
December 2025 housing starts rose 6.2% month over month to 1.40 million SAAR but are 7.3% lower year over year, with single-family starts falling 9% to 981,000 units, underscoring persistent weakness in the largest construction segment.
2. Permit Data and Builder Sentiment
Total building permits increased 4.3% month over month, but single-family approvals slipped 10.9% year over year even as multifamily permits jumped 15.5%, while the NAHB confidence index fell to 36 as over a third of builders cut prices and 65% offered sales incentives.
3. Forecasts and ETF Implications
Analyst projects total housing starts will decline to 1.37 million in 2026 before a modest recovery in 2027, driven by ongoing pressure on single-family activity, suggesting continued headwinds for homebuilder ETFs.