Housing starts in the South plummeted 17.1% in March to a seasonally adjusted annual rate of 673,000, the lowest level since October 2024.
- The drop underscores growing caution among homebuilders as economic uncertainty and affordability concerns weigh on the housing market.
- Completions also declined in the region, falling 3.3% to an annual rate of 846,000, the lowest since March 2024.
Optimism: Despite the sharp slowdown in construction activity, building permits in the South rose for the second consecutive month. Permits climbed 3.0% to a seasonally adjusted annual rate of 573,000 in March, the highest since December 2023.
- The South continued to lead all regions, accounting for 56% of building permits, 54.6% of housing completions, and 51% of housing starts.
Nationally, the numbers reflected a similar trend. Housing starts fell 11.4% in March, completions dropped 2.1%, while building permits edged up 1.6%.
What They’re Saying: Odeta Kushi, Deputy Chief Economist at First American, said the national slowdown in permits “suggests a reduced rate of groundbreaking in the upcoming months, due to higher inventory levels in key markets and ongoing challenges with costs and affordability.”
Bottom Line: Builders are clearly reacting to the uncertainty tied to rising costs and global trade tensions. Still, the uptick in permits hints at cautious optimism that the current challenges may prove temporary.
