March 2012 housing starts for privately owned housing dropped to 654,000 or 5.8% below February housing starts of 694,000. On a year-over-year basis, the March 2012 rate is 10.3 percent above March 2011 figures of 593,000 units. Housing starts for the single-family home component of the indicator decrease to 462,000 or 0.2 percent in March as compared to the revised rate of 463,000 for the prior month.
Apartment buildings with five or more apartments, which includes townhouses, recorded an annual rate of 178,000.
The news for build permit authorization provides a dose of hope for a housing recovery to take place. The housing permit rates increased 4.5% higher than the revised authorization rate of 715,004 February —the highest rate since September 2008. Analysts predicted a decline to an annual rate of 710,000. This figure increased 30.1% higher than the 574,000 rate recorded for March of last year.
Single-family home permit approvals dropped to an annual rate of 462,000 or 3.5% below the revised February rate – 479,000. Single-family homes make up 70 percent of building permit authorizations. Municipal building departments issued permits for buildings, with five or more apartments, at a rate of 262,000.
The 600,000 rate for the number homes completed in March registers 4.2 percent below the revised February numbers of 576,000, but more than 0.5% above March 2011 rate (577,000). A rate of 440,000 single-family homes completions in March registered 1.4 percent more over than the revised February number (479,000). The rate of completion for apartment buildings with at least five dwelling units registered 262,000.
The housing market showed signs of rebounding late last year on through February. The market has a difficult road to climb out of a depressed construction market. Builders’ confidence fell last month, which represents the first drop since September 2011.
About Housing Starts
The housing starts report or New Residential Construction Report represents a joint effort between the U.S. Census Bureau and U.S. Department of Housing and Urban Development. Each month, these agencies poll homebuilders from across the nation to gather data on homebuilding activities. The metrics measure housing starts, building permits and housing completions.
Data measures construction activities from four regions: Northeast, Midwest, South and West, which enable users to focus on regional variances. Housing starts and building permits rates represent a percentage change from the previous month and a year-to-year basis. The agencies adjust data to account for seasonal and non-seasonal variations.
The new construction market has to deal with competition from heavily discounted foreclosures, short sales and existing homes sales, which offer better bargains to homebuyers. New home sales account for 20 percent of the home market. According to the National Association of Home Builders, a single new home creates three jobs for 12 months and produces around $90,000 in taxes for the economy.