Buyer demand may be making a comeback, but builders have lost a lot of ground. The housing industry was already struggling to build itself out of an inventory shortage before the pandemic hit. Even though construction remained essential in many parts of the country, many builders slowed their pace, according to MarketWatch. April housing starts fell 30 percent compared to March, and both single-family and multifamily experienced significant declines. Permitting activity has declined as well, falling 20.8 percent from March.
The numbers: Housing starts occurred at an 891,000 seasonally adjusted annual rate in April, the Commerce Department said Tuesday, representing a 30% drop from March. It was the slowest pace of new home construction since February 2015.
Permitting activity for newly-built homes fell 20.8% between March and April to a seasonally adjusted annual rate of 1.07 million.
Housing starts fell short of the consensus forecast of economists polled by MarketWatch — they estimated new home construction to take place at a 900,000-unit annual rate. Building permits beat economists’ consensus forecast of 996,000.