Housing Starts Unexpectedly Plunged in September

US President Joe Biden listens to Interior Secretary Deb Haaland (out of frame) speak, before signing three proclamations restoring protections stripped by the Trump administration for Bears Ears, Grand Staircase-Escalante, and Northeast Canyons and Seamounts national monuments, on the North Lawn of the White House on October 8, 2021 in …
OLIVIER DOULIERY/AFP via Getty Images

Homebuilding in the U.S. slowed down considerably in the final weeks of the summer, data from the Census Bureau showed Tuesday.

Housing starts in September came in at an annual rate of 1.555 million, below the 1.61 million forecast. The starts figures for July and August were also revised down, suggesting that the home construction business was more sluggish than previously thought.

Permits were also disappointing at an annualized pace of 1.589 million, below expectations for 1.67 million. August was revised down slightly.

Single-family housing starts were virtually unchanged from the prior month at 1.08 million.

Homebuilder confidence has surged recently but builders say they are hindered by episodic shortages of materials and a persistent shortage of workers. At the end of August, the construction industry had 344,000 open jobs, with similar figures in July and June.

The Biden administration has been advancing a set of policies that would challenge zoning restrictions in suburban communities, aimed at encouraging the construction of more apartments and other multi-family units. Many of the left think that zoning rules effectively exclude too many people of color, describing the traditional rules as part of a system of white supremacy or white privilege.

Home prices have soared over the past year and a half, boosted by demand for single-family homes on the part of people moving out of city centers. Long-standing patterns of real estate prices indicate that American families tend to favor single-family houses in communities where that is the predominant or even exclusive form of housing.

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