Single-family housing starts jumped 5.5% in August to their highest level in two years while multifamily construction cooled, according to new government figures released Wednesday morning.
The Census Bureau reported that single-family activity rose to a 535,000 seasonally adjusted annual rate in August from a 507,000 reading in July. The last time builders broke ground on that many homes was back in April 2010.
Meanwhile, construction of apartments fell almost 3% in August to a 208,000 unit SAAR, down from a 214,000 unit rate in July.
Overall, single-family starts rose 27% from a year ago. Multifamily starts spiked 37%.
A new National Association of Home Builders survey shows that confidence among builders has risen over the past five months to the highest level since June 2006. “Builders across the country are expressing a more positive outlook on current sales conditions, future sales prospects and the amount of consumer traffic they are seeing through model homes than they have in more than five years,” said NAHB chief economist David Crowe.
“However, against the improving demand for new homes, concerns are now rising about the lack of building lots in certain markets and the rising cost of building materials,” he said. “Given the fragile nature of the housing and economic recovery, these are significant red flags.”