WASHINGTON, DC-Nationwide housing starts rose 15% to a seasonally adjusted annual rate of 658,000 units in September, according to US Commerce Department statistics. Driving this growth was the multifamily sector, which saw starts rise by 51.3% for the month. The jump raised concerns, at least at one analyst firm, BMO Capital. The firm foresees trouble with multifamily REITs because of the excess supply entering the pipeline, according to the Wall Street Journal.
However, National Association of Home Builders chief economist David Crowe thinks the jump is more of a statistical bubble than anything else. “It is definitely not a construction bubble,” he tells GlobeSt.com. “Multifamily starts were down significantly in August, so some of this increase in September is an adjustment to that.”
Also, there is growth expected in the apartment sector so a construction build-out is not unwarranted, he continues. “If you believe, as I do, that we will see an increase in employment, that will lead to a release of pent up demand for housing by people living with family or roommates now.”
The Commerce Department reported that single-family housing starts rose 1.7% to a seasonally adjusted annual rate of 425,000 units in September, regaining much of the ground lost in August. Multifamily starts reached a seasonally adjusted annual rate of 233,000 units, the highest level since October of 2008.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.