Housing starts fell 0.2% in February compared to January to reach a seasonally adjusted annual rate of 907,000, according to figures released Tuesday by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
This is slightly below the revised January estimate of 909,000 units and is 6.4% below the February 2013 rate of 969,000 units.
Single-family housing starts in February were at a rate of 583,000 – about 0.3% above the revised January figure of 581,000. The rate for multifamily housing starts – defined as units in buildings with five units or more – was 312,000.
Still, there was a 7.7% increase in the number of active building permits in February, compared to January, indicating that new construction will be picking up as we move into April. Building permits were at a seasonally adjusted annual rate of 1,018,000 – up from the revised January rate of 945,000 and 6.9% above the February 2013 estimate of 952,000.
Single-family authorizations in February were at a rate of 588,000, which is 1.8% below the revised January figure of 599,000. Authorizations of units in buildings with five units or more were at a rate of 407,000.
Housing completions in February were at a seasonally adjusted annual rate of 886,000 – 4.4% above the revised January estimate of 849,000 and 21.9% above the February 2013 rate of 727,000.
Single-family housing completions in February were at a rate of 631,000 – 4% above the revised January rate of 607,000. The February rate for units in buildings with five units or more was 246,000.
Harsh winter weather during January and February reportedly played a role in the lower-than-expected number of housing starts. Not only has the harsh weather slowed construction of new homes – it has also kept many home shoppers on the sidelines.
What's more, home builders are having problems finding qualified skilled laborers, as well as available building lots.
As a result, builder confidence in the market for newly built, single-family homes rose only one percentage point on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index in March. In a statement, David Crowe, chief economist for the NAHB, says ‘a shortage of buildable lots and skilled workers, rising materials prices, and an extremely low inventory of new homes for sale’ have combined to take a bite out of builder confidence.
Still, demand for new construction has never been stronger:
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