WASHINGTON, DC—October's residential construction starts and permits beat analysts' estimates, with multifamily putting in an especially strong showing. While building activity in the comparatively volatile apartment sector has often trailed that of single-family over the course of this year—and at times brought down the overall gains—October data from the Census Bureau show the sector leading the way.

Overall residential starts in October were at a seasonally adjusted annual rate of 1.29 million units, up 13.7% from September and the fastest pace in a year. Economists polled by Reuters and Bloomberg News had projected annualized totals of 1.185 and 1.19 million units, respectively. Starts for single-family were up by 5.3%, while multifamily groundbreakings jumped 36.8% from the previous month to an annualized pace of 393,000 units.

Although the South was credited with much of the surge in activity as areas hit hard by Hurricanes Harvey and Irma began to rebuild, other regions of the US also saw an uptick. Starts overall in the Midwest and Northeast were up even more sharply on a percentage basis, albeit with fewer units in each region, although total starts were down in the West by 3.7% compared to September.

Permits for residential projects of all types were up 5.9% to a seasonally adjusted annual rate of 1.3 million units. In the apartment sector, authorizations posted a 13.4% increase from the previous month to an annualized rate of 416,000 units. On a regional basis, all areas of the US saw percentage gains compared to September, although only the Northeast and West were up year-over-year.

The news from the Census Bureau comes on the heels of the National Association of Home Builders reporting an eight-month high in the NAHB/Wells Fargo Housing Market Index reflecting confidence in the single-family home market. “Demand for housing is increasing at a consistent pace, driven by job and economic growth, rising homeownership rates and limited housing inventory,” NAHB chief economist Robert Dietz said Thursday. “With these economic fundamentals in place, we should see continued upward movement of the single-family housing market as we close out 2017.”

Instant Insights /

Apartment Starts, Permits Jump in October

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