Housing construction fell in November

Construction of new homes slipped last month but builders are upbeat that the market is on the right track. 

Building ticked down 1.6 percent to a seasonally adjusted annual rate of 1.03 million homes and apartments in November, the Commerce Department reported Tuesday.

{mosads}Construction totals were revised up for October and the market produced more than 1 million homes in each of the past three months. 

“These numbers are in line with our latest surveys, which show that single-family builders are confident that the market is gradually recovering,” said Kevin Kelly, chairman of the National Association of Home Builders (NAHB) and a homebuilder and developer from Wilmington, Del.

Three-month moving averages for total and single-family production were at their highest levels since the recession ended in 2009.

“Over the course of the year, the number of houses under construction has been on an upward trajectory, signaling that housing is moving forward,” said David Crowe, NAHB’s chief economist.

“With strong demand, affordable home prices and favorable interest rates, we should see housing production continue to grow into 2015.”

The drop last month can be attributed to a 5.4 percent decline in single-family housing starts, which fell to a seasonally adjusted annual rate of 677,000 units in November.

Meanwhile, multi-family production rose 6.7 percent to 351,000 units.

Regionally, production increased 8.7 percent in the Northeast, 14.4 in the Midwest and 28.1 percent in the West, while building fell 19.5 percent in the South.

Building permits also fell last month, down 5.2 percent to a seasonally adjusted annual rate of 1.035 million units in November.

Multi-family permits dropped 11 percent to 396,000 units while single-family permits slipped 1.2 percent to 639,000 units.

The Northeast posted a 27.4 percent increase in permits while the Midwest, South and West all registered losses of 7.3 percent, 10 percent and 5.6 percent, respectively.