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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 54 September 2024 J O U R N A L cut, it is still important to closely monitor how these highly leveraged loans perform in the months ahead. JULY HOUSING STARTS DROP TO FOUR-YEAR LOW A ccording to the latest U.S. Census Bureau and the U.S. Department of Housing & Urban Development's (HUD) new residential construction report, private- ly-owned housing starts in July 2024 were at a seasonally adjusted annual rate of 1,238,000, 6.8% below the revised June 2024 estimate of 1,329,000, and 16% year over year below the July 2023 rate of 1,473,000. Single-family housing starts in July were reported at a rate of 851,000—14.1% below the revised June 2024 figure of 991,000. The July rate for units in buildings with five units or more was 363,000. "Housing starts came in below expec- tations, dropping to the lowest level since May 2020. The monthly decline was driv- en by a sharp drop in single-family starts, down 14%, to a seasonally adjusted annual rate of 851,000," First American Deputy Chief Economist Odeta Kushi said. "Sin- gle-family permits, a leading indicator of future starts, also continued its downward trend. Single-family permits are down 9% from their recent 2024 peak. This month's decline was modest compared to recent months, perhaps pointing to a stabilization in single-family permits." Privately owned housing units authorized by building permits in July were at a seasonally adjusted annual rate of 1,396,000—4% below the revised June 2024 rate of 1,454,000 and 7% below the July 2023 rate of 1,501,000. Single-family authorizations in July were at a rate of 938,000—0.1% below June 2024's revised figure of 939,000. Authorizations of units in buildings with five units or more were at a rate of 408,000 in July. "There was a pronounced downturn in new residential construction activity across the United States in July after a positive swing the month before," Real- tor.com Senior Economist Joel Berner said. "Permits issued for new housing units fell to 1,396,000 on a seasonally adjusted annual basis, down 4.0% from June and 7.0% year over year. Housing starts dropped from June's level by 6.8% and remain 16.0% below the housing starts figure from last year at this time. Housing completions decreased from their June rate by 16.0% but remained above 2023 levels by 13.8%. Multifamily projects were the focus of the slide in completions, falling 24.4% month over month, while single-family completions actually rose by 0.5%." Privately owned housing completions in July were at a seasonally adjusted annual rate of 1,529,000, which was 9.8% below the revised June 2024 estimate of 1,696,000, but 13.8% above the July 2023 rate of 1,343,000. Single-family housing completions in July were at a rate of 1,054,000—0.5% above the revised June rate of 1,049,000. The July rate for units in buildings with five units or more was 473,000. "The decline in new home construction mirrors our latest builder surveys, which show that buyers remain concerned about challenging affordability conditions and builders are grappling with elevated rates for builder loans, a shortage of workers and lots, and supply chain concerns for some building materials." —Carl Harris, Chairma, National Association of Home Builders