Apartment Construction Peak in Sight, Single-Family Development Could Fade in 2018
By Steve Hovland
Director of Research
The new residential construction report from the U.S. Census Bureau offers a mixed outlook on the supply side of the housing market. Year-over-year, permitting and completions outpaced last year’s performance. Building permits registered 1.2 million last month, up 4.1 percent from the same period last year, while completions recorded an 8.2 percent increase from July of 2016 at 1.2 million. However, housing starts are down from both June of this year and July of 2016, which could be our first indication that the peak of this construction cycle is on the horizon. In July, builders broke ground on 1.2 million homes, 5.6 percent lower than one year ago. Much of the decrease is in the multifamily sector, where demand for new units has failed to keep pace with supply in many urban core locations. Apartment construction, which is easier to forecast due to the longer timeline on most projects, is expected to peak this year.
To see how the new report is impacting the real estate market, visit: https://www.homeunion.com/blog/are-builders-ready-to-wind-down-construction.
HomeUnion is an online real estate investment management firm. Based in Irvine, Calif., it provides all the services needed for individuals to invest remotely in rental properties. The company uses a combination of research and proprietary analytics to incorporate data on over 110 million homes and 200,000 neighborhoods into their database, and then delivers its solutions to an on-the-ground infrastructure that currently serves 11 locations. HomeUnion’s role spans the lifecycle of the investment transaction: identifying sound investments, handling all aspects of acquisition, maximizing income, protecting asset value, and selling the asset when the time comes.