US single-family housing starts tumble in October
2024.11.19 08:59
WASHINGTON (Reuters) – U.S. single-family homebuilding tumbled in October as Hurricanes Helene and Milton depressed activity in the South and permits rose slightly, suggesting that a rebound was likely to be muted by higher mortgage rates.
Single-family housing starts, which account for the bulk of homebuilding, plunged 6.9% to a seasonally adjusted annual rate of 970,000 units last month, the Commerce Department’s Census Bureau said on Tuesday. Data for September was revised higher to show homebuilding rising to a rate of 1.042 million units from the previously reported pace of 1.027 million units.
Single-family starts dropped 10.2% in the South.
Permits for future construction of single-family housing gained 0.5% to a rate of 968,000 units.
New construction has regained ground after taking a beating from a resurgence in mortgage rates during the spring. Momentum has, however, been restricted by new housing supply at levels last seen in 2008, hurricanes in the U.S. Southeast as well as still-elevated borrowing costs.
Mortgage rates initially fell as the Federal Reserve started cutting interest rates in September. They have, however, erased that decline on strong economic data and concerns that President-elect Donald Trump’s policies, including tariffs on imported goods and mass deportations of migrants, could reignite inflation.
The yield on the benchmark 10-year U.S. Treasury note has risen to a 5-1/2-month high and remains not too far from that level. Mortgage rates track the 10-year note.
While a National Association of Home Builders survey on Monday showed homebuilder sentiment rose to a seven-month high in November, that was largely due to builders “expressing increasing confidence that Republicans gaining all the levers of power in Washington will result in significant regulatory relief for the industry.”
