Homebuilders broke ground on new homes at the fastest pace in about eight years, according to statistics released by the Commerce Department Tuesday.
“A fresh supply of new homes will therefore reach the market in upcoming months to help relieve the inventory tightness,” says Lawrence Yun, the chief economist for the National Association of REALTORS®. “There is no need to worry about an oversupply. Even more production would be welcomed.”
An increase in single-family housing starts led the strong rebound in housing production in July, climbing 12.8 percent month over month to a seasonally adjusted annual rate of 782,000 units. The volatile multifamily market, on the other hand, dropped 17 percent last month to 424,000 units.
“Our builders are reporting more confidence in the market, and are stepping up production of single-family homes as a result,” says NAHB Chairman Tom Woods. “However, builders are still reporting problems accessing land and labor.”