Single-family housing construction rebounded in August, although broader U.S. residential development continued to face pressure from financing costs, construction expenses and affordability challenges.
Housing starts across all sectors declined 2.6% in August to a seasonally adjusted annual rate of 1.28 million units, according to data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The annualized figure represents the pace at which builders would start homes if the August rate continued for 12 months.
Single-family starts rose 7.6% in August to a seasonally adjusted annual rate of 918,000 units. The August pace was 5.2% higher than the same month in 2025.
Despite the monthly improvement, single-family production remained down 4.7% year to date. Builders continue to navigate higher construction costs, limited lots and labor availability, along with uncertainty surrounding future demand.
NAHB Chairman Bill Owens said higher mortgage rates, construction financing costs and affordability challenges continue to constrain momentum in new-home construction.
Regional results also varied. Combined single-family and multifamily starts were up 10% year to date in the Northeast and 0.4% in the Midwest. Starts were down 2.4% in the South and 3% in the West.
Multifamily construction recorded a sharper monthly decline. Starts in the apartment and condominium segment fell 21.7% in August to a seasonally adjusted annual rate of 357,000 units. That pace was 14.6% below August 2025.
The decline in multifamily starts contributed to the overall reduction in housing construction during the month, while single-family activity moved in the opposite direction.
Building permits also decreased in August. Total permits fell 2.7% to a 1.39 million-unit annualized rate. Single-family permits declined 1.8% to an 878,000-unit rate but remained 1.3% above August 2025. Multifamily permits decreased 4.3% to an annualized rate of 516,000 units, although they were 7.5% higher than a year earlier.
Year-to-date permit activity points to different construction conditions across major U.S. regions.
Permits were up 12.5% in the Northeast and 2.7% in the Midwest. The South recorded a 3.5% decline, while the West posted a 1.7% increase.
NAHB senior director of forecasting and analysis Jing Fu said year-to-date declines in single-family permits indicate continued caution among builders. The Midwest has remained comparatively stronger, with single-family permits up 2.9% year to date through August.
The August housing data shows a split residential construction market, with single-family starts recovering during the month while multifamily starts contracted sharply.
For home builders, developers and contractors, financing costs, affordability, labor availability and construction expenses remain important factors in determining project timing and production levels. Regional differences in permits also indicate that residential construction conditions are not uniform across the U.S. market
Source: NAHB.
