Housing Starts Rise 2.2 Percent In 2001
January 18, 2002
December Starts Fall 3.4 Percent on Multifamily Decline; Single-Family Posts 3.6 Percent Gain
WASHINGTON, -Indicating the remarkable resilience of the nation's housing market in a year marked by terrorist attacks and recession, U.S. housing starts rose 2.2 percent in 2001 to a healthy 1.6 million units, according to figures released by the Commerce Department today. Year-end figures showed a 3.4 percent decline in starts for the month of December due entirely to a shortfall in multifamily production.
"Housing clearly showed surprising strength amid some tough economic times in 2001," said Bruce Smith, president of the National Association of Home Builders (NAHB) and a home builder from Walnut Creek, Calif.
Crediting favorable financing conditions, improving consumer confidence and solid demographics as major factors sustaining demand for new homes and apartments at the end of 2001, Smith added that these good market fundamentals should signal continuing improvement in the new year. "Our forecasts indicate that housing will again be a positive contributor to economic growth by 2002's second quarter," he said.
Single-family housing starts rose 3.6 percent in 2001 to 1.275 million units - the second largest figure in more than a decade after 1999's exceptionally strong 1.3 million units. Multifamily starts fell almost 3 percent to 328,000 units. Regionally, starts were up in all but the Northeast for the year.
In the final month of 2001, single-family starts rose 3.6 percent to a seasonally adjusted annual rate of 1.3 million units, while multifamily starts, which normally display more volatility, fell 26.5 percent to a rate 277,000 units. While overall starts fell in three out of four regions in December - only the West posted a gain - the declines were primarily on the multifamily side, with single-family starts up strongly in all but the Midwest.
Housing permits, which can be an indicator of future building activity, rose slightly from 1.59 million in the year 2000 to 1.61 million for all of last year. Single-family permits in 2001 rose marginally to 1.22 million units, while multifamily permits fell by 4,000, to 390,000 units. Regionally, permits were mixed for the year, with the South and West posting gains and the Northeast and Midwest posting declines.
In December, permitting activity rose across the board, with an overall 3.6 percent gain brought on by a 3.1 percent gain on the single-family side and a 5.2 percent boost on the multifamily side. Every region reported increased permits in December except the West, which registered a decline of less than one percent.
Source: The National Association of Home Builders