U.S. Housing Starts and Permits (June 2026)

Homebuilding activity rebounded strongly in June

• Housing starts increased 19.0% month-on-month (m/m) in June to 1.43 million (annualized) units, far stronger than consensus expectations for 1.31 million units.
• June's uptick was largely driven by a 76.2% m/m increase in multi-family starts, retracing the sharp decline recorded in May, while single-family starts saw a modest decline of 0.2% m/m.
• Residential permits fell 3.1% m/m to 1.37 million annualized units. This decline was led by a 4.3% contraction in multi-family permits, while single-family permits fell by 2.6%.
• Housing starts rose in all four Census regions, with the Northeast (+10.3%), South (+15.2%), West (+22.1%), and Midwest (+33.3%) all recording gains during the month.
  
   

Key Implications

• Homebuilding activity saw a strong rebound in June as the volatile multi-family segment retraced the sharp decline recorded in May. Despite the volatility, multi-family starts have continued to rise gradually over the past two years as the number of units under construction normalized from its prior post-pandemic high. In contrast, single-family starts remain below their 2024 pace as affordability challenges and elevated inventories of new homes continue to weigh on builder activity.
• On aggregate, homebuilding conditions remain challenging as financing rates have returned to an upward trajectory following the resumption of geopolitical tensions in the Middle East. Financial markets currently expect at least one interest rate hike by year-end, which is likely to keep mortgage rates close to their current level through year-end. This in turn has weighed on homebuilder sentiment, with the National Association of Home Builder's sentiment index falling for a second consecutive month in July. Altogether, homebuilding activity is likely to remain subdued through the second half of 2026 amid these challenges.
  
   

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