Builder caution defines August despite single-family start gains
Multifamily construction continued its retreat, with starts on projects of five or more units plunging 22.5% to 344,000 units.
The month did bring one meaningful upward revision. July’s headline figure was bumped significantly to 1.3 million from 1.2 million, and single-family July starts were lifted to 853,000 from 808,000, suggesting building activity last month was more robust than first measured.
Mark Fleming, chief economist at First American Financial Corporation in Washington, DC, said the August rebound reflects caution rather than conviction.
“Single-family construction showed some life in August, but builders aren’t stepping on the gas just yet,” Fleming said.
“New-home inventory remains elevated, affordability is still keeping buyers on the sidelines, and incentives are doing much of the work to generate sales. Until demand strengthens more convincingly, builders will continue to manage the construction pipeline cautiously.”
