New-home construction starts and permits reached the highest level since 2006 in December, according to MarketWatch. Builders began construction at a seasonally-adjusted annual rate of 1.67 million—5.8% higher than November. Permits for December 2020 were 17% higher than one year ago and up 4.5% from November. Both numbers exceeded expert expectations and come as a result of the continued high demand for homebuying. With housing inventory remaining low and home prices reflecting that, many builders see it as a good time to ramp up construction for single-family homes.
Growth in the single-family sector drove the rise in both housing starts and building permits. On a monthly basis, single-family starts were up 12%, while single-family permits were up 7.8%. Comparatively, new construction on multifamily buildings fell 15.2% between November and December, while multifamily permits for buildings with five or more units slipped 2%. Permits for duplexes, triplexes and quadplexes dropped 11.5%.
On a regional basis, all parts of the country saw permitting activity increase except for the Northeast where it fell some 7.2%. Though even in the Northeast, single-family permits were up on a monthly basis.
Similarly, the Northeast was the only region to see a decline in housing starts — both overall and for the single-family sector. The Midwest experienced the largest growth in housing starts, with a 32% increase.