June proved to be a mostly positive month for home construction in the South, as building permits and completions saw a slight increase, despite a decline in housing starts, according to the latest data from the Census Bureau.
Building Permits: In June, building permits in the South rose to a seasonally adjusted annual rate of 801,000, marking a 2.8% increase from May and the second-highest level recorded this year.
- The South now accounts for 55% of all building permits nationwide
- Nationally, building permits rose by 3.4%, significantly outperforming the modest 0.1% increase that economists had anticipated.
Housing Starts: Conversely, housing starts experienced a downturn, falling to a seasonally adjusted annual rate of 732,000 in June. This represents a 1.7% decrease from May and matches the lowest level observed this year in March.
- Despite this decline, the South remains a key contributor, making up 54% of all housing starts across the country.
- On a national level, housing starts rose by 3.0%, a more positive outcome compared to the 1% drop that economists had expected.
Housing Completions: Completions saw a significant boost in June, reaching a seasonally adjusted annual rate of 887,000, up 2.3% from May and marking the third-best month this year.
- The South accounted for 52% of all housing completions nationwide.
- Nationally, completions jumped over 10%, driven by a remarkable 54% increase in the Midwest, pushing housing completions to the highest level since January 2007.
Bottom Line: June’s data presents a mixed yet optimistic outlook for the housing construction market. The rise in building permits and completions suggests a robust pipeline of future housing supply, while the decline in housing starts indicates some short-term challenges. However, the stronger-than-expected national performance across all metrics provides a positive indication of the sector’s resilience and potential for growth.
