Housing starts were at a seasonally adjusted annual rate of about 1.211 million in July – an increase of 2.1% compared with about 1.186 million in June and an increase of 5.6% compared with about 1.147 million in July 2015, according to figures released by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
Starts of single-family homes were at a rate of about 770,000, an increase of 0.5% compared with about 766,000 in June (the June figures were revised). Starts of multifamily homes (four units or more per building) were at an annual rate of about 433,000, an increase of 8.3% compared with about 400,000 in June.
The increase follows a 4.8% month-over-month increase in June. Housing starts have increased on a month-over-month basis for every month so far this year, except for January and March.
Building permits were at an annual rate of 1.152 million in July – a decrease of 0.1% compared with about 1.153 million in June but an increase of 0.9% compared with 1.142 million in July 2015.
Permits for single-family homes were at a rate of about 711,000, a decrease of 3.7% compared with about 738,000. Permits for multifamily units were running at a rate of about 411,000 in July – an increase of 6.5% compared with about 386,000 in June.
Housing completions were at a seasonally adjusted annual rate of 1.026 million, a decrease of 8.3% compared with about 1.119 million in June but an increase of 3.2% compared with about 994,000 in July 2015.
Completions of single-family homes were at a rate of about 743,000, a decrease of 0.4% compared with about 746,000 in June. Completions of multifamily units were at a rate of about 275,000, a decrease of 24.5% compared with 364,000 in June.
The fact that housing starts are on the rise is good news for the mortgage industry. One of the main reasons home sales have been so slow this year is due to the fact that home prices are on the rise because of a lack of available inventory. Building more units not only increases inventory and boosts sales volume, but also helps keep prices in check, which, in turn, leads to more future sales.