Housing starts drop but building permits on the rise
Housing starts declined in the last month of 2010, reaching their slowest pace since October 2009, new Commerce Department data show. The news was not all grim however—building permit issuance rose 16.7 percent in December 2010.
Housing starts decreased by 4.3 percent last month, reaching a seasonally adjusted rate of 529,000, the National Association of Home Builders (NAHB) reported. The drop was primarily due to a decrease in single-family home starts, which fell nine percent. Multi-family housing starts posted a gain, however, rising 17.9 percent.
Regionally, the West posted a large jump in housing starts, gaining 45.8 percent after two extremely slow months. All other regions declined, with the Midwest posting the biggest decrease, 38.4 percent.
Permit issuance rose for both single-family and multi-family housing in December, gaining 5.5 percent and 53.5 percent respectively. The South was the only region to post a decline in this area that month.
According to NAHB economists, these numbers indicate that although builders are still cautious about the state of the housing market, they are preparing for improvements in the coming year.