New Home Construction Sees Bump in October

New Home Construction
New Home Construction | Image by ungvar/Shutterstock

Construction of new single-family homes in the United States increased last month.

The annual pace of new home construction hit 1,372,000 in October, a 1.9% increase over September’s revised estimates but 4.2% below the 1,432,000 reported during the same month last year, according to the latest residential construction statistics from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

Meanwhile, single‐family housing starts increased by 0.2% during the month, rising from a revised figure of 968,000 in September to 970,000 in October.

“The increase in starts this month shows that builders are anticipating positive conditions over the next year when these homes become available for buyers,” said Kelly Mangold of RCLCO Real Estate Consulting, CNN Business reported.

The number of single-family permits authorized in October reached the highest level in nearly 1.5 years, according to Friday’s report. Overall, privately‐owned housing units authorized by building permits were 1,487,000 in October, roughly 1.1% above the revised September rate of 1,471,000 but 4.4% below the rate of 1,555,000 in October 2022.

Homebuilders in the United States must receive a building permit before construction on a single-family can begin. In October, single-family building permit authorization increased by 0.5%, rising from 963,000 in September to a current rate of 968,000, the latest statistics show.

As previously covered by The Dallas Express, home sales have been dampened by surging mortgage interest rates and stubbornly high home prices. However, buyer demand has remained robust in Texas compared to other parts of the country.

Development Services Department officials in Dallas have been turning around residential permits for single-family home builds quicker than in previous years. Still, overall building permit activity under City Manager T.C Broadnax has been down year over year, possibly due to the periodic delays and backlogs seen in the department’s operations.

While new home starts saw an uptick in October, the number of homes completed during the month fell from 1,478,000 in September to 1,410,000 in October, an annual seasonally adjusted rate of 4.6%, per the report.

Despite the monthly decrease, housing completions were up 4.6% from a year earlier. Overall, single‐family housing completions were at a rate of 993,000 in October, about 0.9% below the revised September rate of 1,002,000.

“Homebuilders have an opportunity to capitalize on the low supply of homes on the market,” said Jeffrey Roach, chief economist at LPL Financial in Charlotte, North Carolina, per Reuters. “If mortgage rates move lower in the latter half of next year, we could see some improved demand for residential real estate.”

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