U.S. Single-Family Housing Starts Fall Third Straight Month

U.S. single-family housing starts declined for a third consecutive month in June to a seasonally adjusted annual rate of 895,000 units. Building permits for single-family homes also dropped 2.4% to 871,000 units, marking the lowest level in 10 months.

The downturn stems from rising land and material costs and a surplus of unsold new homes. Mortgage rates further strained the market, averaging an 11-month high of 6.55% this week. These rates rose nearly 60 basis points following the collapse of a ceasefire between the United States and Iran and subsequent military conflict.

Legislative efforts to address these trends saw limited success. While the United States Congress passed bipartisan housing affordability legislation to streamline zoning and environmental reviews, Donald Trump declined to sign the bill. The legislation became law without his signature after he demanded the passage of a separate voting bill.

Despite the struggle in the single-family sector, overall housing starts rose 19% due to a surge in projects featuring five or more units.