April Housing Starts: Slowly Boosting the Housing Stock

• April housing starts totaled 1.72 million (SAAR), down 0.2% from March 2022 and up 14.6% from April 2021, according to the U.S. Census Bureau.
• Housing permits issued in April were down 3.2% from March and up 3.1% from a year ago, to 1.82 million (SAAR).
• 1.30 million (SAAR) homes were completed in April, down 5.1% from March and down 8.6% year-over-year.

In the face of rising interest rates and continued supply chain disruptions, builders in April narrowly missed maintaining the strong pace of housing starts achieved in recent months. With mortgage rates now at their highest levels since 2009 and the market showing signs of a rebalancing, future housing demand is uncertain. It appears likely demand will remain strong for quite some time, but the market will have to slow to some degree from today’s record-breaking pace. Despite declining optimism from builders, they are still beginning new projects at a rate we did not see in the decade prior to the pandemic. Of note, there are more multifamily housing starts than at any time since the 1980s – a potential signal of builders looking to expand the housing supply, create more affordable options, and perhaps shift focus towards the rental market as rising prices and high mortgage costs influence the calculus for potential buyers. Builders are continuing to chip away at the shortage of homes built since the Great Recession, and are yet again showing very little signs that they are taking their foot off the gas.