![\"\"](\"https:\/\/www.livabl.com\/articles\/wp-content\/uploads\/2021\/01\/housing-starts.jpg\")
<\/a>Photo: James Bombales<\/em><\/p>\nIn an effort to satisfy demand from hungry buyers, who currently face record-low inventory levels, US homebuilders ramped up construction in December, reaching the highest pace in more than 14 years.\u00a0<\/span><\/p>\n According to the latest <\/span>residential construction report<\/span><\/a> from the Census Bureau, housing starts climbed 5.8 percent to 1.67 million annualized units last month. Compared to the same period in 2019, home building activity is up 5.2 percent, propelled by single-family starts, which increased by 12 percent to 1.34 million annualized units.<\/span><\/p>\n Despite the COVID-19 pandemic, single-family housing starts hit a 13-year high in 2020. As mortgage rates sank to historic lows, more buyers began to enter the market, heightening competition for a limited number of properties. New construction homes are particularly attractive because they eliminate the risk of a bidding war and are presented in turnkey condition.<\/p>\n Multifamily starts, representing condominiums, townhouses, duplexes, etc., declined by 13.6 percent in December and 2 percent annually. \u201cThe ongoing divergence between single-family and multifamily is consistent with the continued interest of many homebuyers in moving to suburban and smaller metro areas,\u201d wrote Doug Duncan, Chief Economist at Fannie Mae, in a statement.<\/p>\n \u201cWe expect multifamily construction to be comparatively weak over the coming year as this COVID-related dynamic continues to play out.\u201d<\/p>\n Building permits, an indicator of future housing starts, surged 4.5 percent in December to an annualized rate of 1.71 million units. Compared to year-ago levels, permits are up 17.3 percent, driven once again by single-family authorizations. These permits will likely materialize as housing starts in one to two months\u2019 time.<\/p>\n While this should spell good news for the new construction market, homebuilder confidence was knocked down a peg in January due to rising lumber and land prices. The <\/span>NAHB\/Wells Fargo Housing Market Index<\/span><\/a>, published on Wednesday, fell 3 points to a reading of 83. The index hit an <\/span>all-time high in November<\/span><\/a> when it reached 90, although any number over 50 is generally considered to be positive.<\/span><\/p>\n \u201cWhile housing continues to help lead the economy forward, limited inventory is constraining more robust growth,\u201d said NAHB Chief Economist Robert Dietz in a press release. \u201cA shortage of buildable lots is making it difficult to meet strong demand and rising material prices\u00a0are far outpacing increases in home prices, which in turn is harming housing affordability.\u201d<\/span><\/p>\n According to the latest residential construction report from the Census Bureau, housing starts climbed 5.8 percent to 1.67 million annualized units last month. <\/p>\n","protected":false},"author":12,"featured_media":212617,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","apple_news_api_created_at":"2021-01-21T22:28:22Z","apple_news_api_id":"03b0e3de-1d7b-4716-b21a-aa7791087527","apple_news_api_modified_at":"2021-01-21T22:28:22Z","apple_news_api_revision":"AAAAAAAAAAD\/\/\/\/\/\/\/\/\/\/w==","apple_news_api_share_url":"https:\/\/apple.news\/AA7Dj3h17RxayGqp3kQh1Jw","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_is_hidden":false,"apple_news_is_paid":false,"apple_news_is_preview":false,"apple_news_is_sponsored":false,"apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"middle","apple_news_slug":"","apple_news_sections":["https:\/\/u48r14.digitalhub.com\/sections\/09b86915-7d2b-3acd-915b-b215002d01b7"],"apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"footnotes":""},"categories":[11269],"tags":[],"coauthors":[8647],"apple_news_notices":[],"yoast_head":"\n