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Today, in the CalculatedRisk Real Estate Newsletter: December Housing Starts: Most Housing Units Under Construction Since 1973
Excerpt:
The 1.595 million total starts in 2021 were up 15.6% from 1.380 million in 2020. Starts in 2021 were the most since 2006 when 1.801 million units were started.
The fourth graph shows housing starts under construction, Seasonally Adjusted (SA).
Red is single family units. Currently there are 769 thousand single family units under construction (SA). This is the highest level since February 2007.
For single family, most of these homes are already sold (Census counts sales when contract is signed). The reason there are so many homes is probably due to construction delays. Since most of these are already sold, it is unlikely this is “overbuilding”, or that this will impact prices (although the buyers will be moving out of their current home or apartment once these homes are completed).
Blue is for 2+ units. Currently there are 750 thousand multi-family units under construction. This is the highest level since July 1974! For multi-family, construction delays are probably also a factor. The completion of these units should help with rent pressure.
Census will release data in March (part of February survey) on the length of time from start to completion, and that will probably show long delays in 2021. In 2020, it took an average of 6.8 months from start to completion for single family homes, and 15.4 months for buildings with 2 or more units.
Combined, there are 1.519 million units under construction. This is the most since November 1973.
There is much more in the post. You can subscribe at https://calculatedrisk.substack.com/ (Most content is available for free, so please subscribe).
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