Wednesday, January 30, 2013

Housing starts up in West region, multifamily starts surge 92 percent

Housing starts in the West Census region of the US, which includes Colorado, were up 5.7 percent percent from December 2011 to December 2012, counting both single-family and multi-family units. According to new housing construction and housing starts data released last week by the US Census Bureau, single-family housing starts were more or less flat in December when compared to Decembers of the previous 5 years. (Graph units in 1,000s.)

But multi-family housing starts in the West were at a six-year high for December, rising the highest December total since 2006.  

The first graph shows multifamily housing starts for the West region (units in 1,000s): 

Multifamily housing starts increased in the region by 92 percent from December 2011 to December 2012. As the graph shows, overall multifamily activity has increased substnatially since the trough of 2009, and is now at the highest level of activity since 2007. In the West region during December, there were 5,000 new multifamily units started, compared to 2,600 units during the same period of 2011. 

Single-family starts, on the other hand, showed growth that was much more restrained than multifamily growth. Nevertheless, the growth from 2011 to 2012 was substantial with single-family starts increasing 49 percent from December 2011 to December 2012. There were 7,900 new single-family starts during December, compared to 5,300 single-family starts during December of 2011. (Graph units in 1,000s.)

The third graph shows that overall starts have been up from 2011 to 2012, and that activity is generally at a 4-year high.  Starts remain below 2008 levels, however. 

This report signals continued optimism among both home builders and apartment builders. Year-over-year changes are large when compared with last year, showing that there is much improvement from the builders' perspective over the past year. Over a 5-year period, though, starts totals remain well down from peak levels.