New multifamily construction rose in March on a monthly and yearly basis, according to HUD and the U.S. Census Bureau's latest residential construction report released Wednesday.
The seasonally adjusted March rate for construction of units in buildings with five units or more was 446,000, representing a 13.5% year over year increase and a 9.6% uptick from the previous month, per the report. Single-family housing starts in March were at a rate of 1 million, which is 9.7% above the revised February figure and up 8.9% YOY.
Overall, privately owned housing starts in March were at a seasonally adjusted annual rate of 1.5 million, which is 10.8% above both the revised February estimate and the March 2025 rate. The Northeast region showed the greatest strength in overall new residential construction, rising 18.9% from last year, followed by the South with a 14.1% increase.
HUD and the Census Bureau also released initial estimates for February in the report. The rate for starts for buildings with five or more units stood at 407,000, down 14.9% from January. Overall, new housing construction was at a seasonally adjusted annual rate of 1.36 million in February, down 3% from the previous month.
Mixed signals
Broad affordability challenges continue to impact many households, National Apartment Association Vice President of Research George Ratiu told Multifamily Dive in an email.
“New residential construction in February and March underscored the challenges of the current housing market, where builders are walking a precarious line to meet the need for more affordable supply within the constraints of rising inflation and interest rates,” Ratiu said. “Home builder sentiment has been in the doldrums for a year, as slow foot traffic and sales push almost two-thirds of construction companies to offer sales incentives.”
Multifamily building permits, which signal future construction activity, dropped in March to 427,000, down 23.5% MOM and down 5.3% YOY, according to the release.
Overall housing permits fell too, coming in at a rate of 1.37 million, which is 10.8% below the revised February rate and down 7.4% from the same period last year. The South had the highest drop in overall residential permits, down 14% YOY.
Multifamily project completions stood at a seasonally adjusted rate of 452,000 in March. That’s up 10.2% from February but down 9.1% from last year, per the release.
Overall residential completions were at a seasonally adjusted annual rate of 1.37 million, essentially flat from February but down 12.8% YOY. Those overall completions rose 75.9% YOY in the Northeast, but fell in all other regions.
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