U.S. Housing Starts End 2024 on High Note

HUD reported that overall housing starts increased 15.8% in December to a seasonally adjusted annual rate of 1.50 million units. WASHINGTON—Fueled by solid demand, single-family construction increased in December despite several industry headwinds, including high mortgage rates, elevated financing costs for builders, and a lack of buildable lots. Overall housing starts increased 15.8% in December to a seasonally adjusted annual rate of 1.50 million units, according to a U.S. Department of Housing and Urban Development report and the U.S. Census Bureau. This is the highest rate since February 2024. The December reading of 1.50 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months. Within this number, single-family starts increased by 3.3% to a 1.05 million seasonally adjusted annual rate. The multifamily sector, which includes apartment buildings and condos, increased 61.5% to a 449,000 pace. The total number of housing starts in 2024 was 1.36 million, a 3.9% decline from the 1.42 million total in 2023. Single-family starts totaled 1.01 million in 2024, up 6.5% from the previous year. Multifamily starts ended the year down 25% from 2023. “Single-family home building increased 6.5% for 2024, as builders added more supply in a market continuing to face a housing affordability crisis due to elevated mortgage interest rates and higher construction costs,” said Carl Harris, chairman of the National Association of Home Builders (NAHB) and a custom home builder from Wichita, Kan. “Nonetheless, the industry expects to see a slight gain for single-family home building in 2025 because of a persistent housing shortage and ongoing solid economic conditions.” “While December was a solid month for apartment starts, the sector ended 2024 down 25% in total starts,” said NAHB Chief Economist Robert Dietz. “In December, and on a three-month moving average basis, there were 1.7 apartments completing construction for every one apartment starting construction. Multifamily construction will stabilize in 2025 as more deals pencil out, with the industry supported by a low national unemployment rate.” Looking at regional housing starts data for 2024, combined single-family and multifamily starts were 9.1% higher in the Northeast, 0.1% lower in the Midwest, 5.2% lower in the South and 7.7% lower in the West. Overall permits decreased 0.7% to a 1.48-million-unit annualized rate in December and were down 3.1% compared to December 2023. Single-family permits increased 1.6% to a 992,000-unit rate but were down 2.5% in December compared to the previous year. Multifamily permits decreased by 5.0% to a 491,000 pace. Regional permit data for 2024 show that permits were 1.5% higher in the Northeast, 3.5% higher in the Midwest, 3.1% lower in the South, and 6.6% lower in the West. The total number of permits in 2024 was 1.47 million, a 2.6% decline from the 1.51 million total in 2023. However, the number of single-family permits in 2024 totaled 981,000, up 6.6% from the previous year, a positive sign for 2025. The number of single-family homes under construction was 641,000, down 5.3% from a year ago. The number of apartments under construction was 790,000, down 21% from a year ago. The number of apartments under construction peaked at 1.02 million in July 2023 and has decreased since then.