Residential construction in the South took a notable downturn in July, According to the latest data from the Census Bureau. This downtown in the South reflects national trends, as higher borrowing costs continue to weigh on buyers and builders.
- Building permits in the South dropped 4.2% to an annual rate of 776,000, the lowest since December 2022.
- Housing starts saw a sharper decline, falling 13.6% to a seasonally adjusted rate of 640,000, marking the lowest level since June 2020.
- Housing completions, which had previously been a bright spot, also decreased by 2.9% to an annual rate of 867,000—the lowest since March 2020.
Nationally, the residential construction sector mirrored these declines. Building permits fell 4.0% to 1.396 million units, the lowest since June 2020. Housing starts dropped 6.8% to 1.238 million units, the lowest since April 2020. Housing completions decreased nearly 10% to 1.529 million units, the lowest since April.
- Swing & A Miss: Economists had anticipated milder decreases, with projections for building permits and housing starts falling by just 0.9% and 0.2%, respectively, making July’s figures significantly worse than expected.
Southern Dominance: Despite the drop, the South still leads in every category. The South makes up 55.6% of all building permits, 51.7% of housing starts, and 56.7% of housing completions.
