Construction of new homes in the U.S. rose for the third consecutive month in December and data released Wednesday (01/19/22) suggests that the frantic pace of building will continue this year.
The December increase puts home construction at a seasonally adjusted annual rate of 1.7 million units, the Commerce Department reported Wednesday (01/19/22). In all of 2021, nearly 1.6 million housing units were started a 15.6% increase over 2020.
The December housing data was boosted by multi-unit projects where starts increased by 5%, offsetting a 2.3% decline in single-family starts. However, economists note that multi-family units make up significantly less of the market than single-family homes, and the data can be volatile from month-to-month. Multi-family permits applications rose about 22%.
What has been a strong housing market for years appears to be on the verge of getting even hotter in spite of rising interest rates. Applications for building permits, which can forecast future building activity, rose a whopping 9.1% to a seasonally-adjusted rate of 1.87 million units. That’s the strongest month for permits since January of 2021.