Housing starts were as expected in April totaling 1.4mm but there was a downward revision of 50k for March to 1.37mm. Single family starts were up by 13k m/o/m to 846k and multi family higher by 17k m/o/m to 555k. As for forward looking permits, those filed for single family grew by 26k to 855k. For multi family it fell by 47k to 561k.
For perspective, the 6 month average for single family starts is now 838k vs the 846k April print. The multi family print is about in line with the 6 month average of 551k.
As for permits, the single family count rose to the highest since last September as we know builders are trying to step in to the existing home supply breach, if one can get financing which we know the bigger companies still can but the smaller ones are having some trouble. Permits though remain well below where they were in February 2020 of 986k. The number of permits filed for multi family projects fell to match the least since December 2020. There are a ton of multi projects under construction with a lot of supply coming over the next year but there is a shrinking amount of new developments underway because the numbers just don’t pencil out anymore with rent growth slowing and where the cost of capital is. More equity is needed in order to get deals done.
So with rents, we’ll have to absorb the oncoming supply glut but when we do, and we will, rent costs are going to accelerate again because we’ll be then shifting to a lack of apartment supply because nothing new is getting started.
Single Family Permits
Multi Family Permits