Another day, another housing report battered by the economic shutdown driven by the coronavirus pandemic.
Residential housing starts in the United States in April dropped 30.2 percent from March and were 29.7 percent below April 19, according to a report released Tuesday by the Census Bureau and the Department of Housing and Urban Development. Single-family housing starts were 25.4 percent below March.
Privately-owned housing starts in April were at a seasonally adjusted rate of 891,000, significantly below the 1.28 million in March.
“This drop in new home construction is not surprising since most states were under stay-at-home orders in April, which included home builders,” said Bill Banfield, vice president of Capital Markets at Quicken Loans. “While it may seem grim, we know there is light at the end of the tunnel because in May, many states – including our home state of Michigan – began to allow construction. This is reassuring since, with home buying expected to bounce back after the country reopens, it is critical builders generate enough new supply to keep up with strong demand.”
The report also found that the number of building permits for privately owned housing units were down 20.8 percent from March and 19.2 percent from April 2019.
Housing completions were 8.1 percent March and 11.8 percent April 2019 – further dampening the supply of houses on the market for would-be buyers.
“Supply is extremely limited, and there are simply not as many homes for sale to meet the demand among potential buyers,” National Association of Realtors Lawrence Yun said last week. “More supply and more listings are needed to provide a faster recovery for the economy.”