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

Homebuilding activity continued to moderate in August

• Housing starts fell 2.6% month-on-month (m/m) in August to 1.28 million (annualized) units, below consensus expectations for 1.32 million units.
• August's decline was entirely driven by a 21.7% m/m drop in multi-family starts, which offset the 7.6% uptick in single-family starts.
• Residential permits fell 2.7% m/m to 1.39 million annualized units in August. Single-family and multi-family permits fell during the month, by 1.8% and 4.3%, respectively.
• Housing starts were lower in three out of four census regions, with the West (+32.4%) recording the only increase. Starts fell in the Northeast (-44.5%), Midwest (-12.0%), and South (-1.35%).
  
   

Key Implications

• Homebuilding activity fell for a second consecutive month in August, as the decline in multi-family starts accelerated and brought the segment to a three-month low. Single family starts fared better, with starts rising to a five-month high. However, with permits falling across both segments, starts are likely to see further moderation in the months ahead.
• Higher financing costs are already influencing the sector in this direction, with the national average for the 30-year fixed rate mortgage back above 7%. As a result, homebuilder expectations for future sales, measured by the National Association of Homebuilders, fell sharply in September to its lowest level in nearly four years. Beyond the direct and indirect effects of higher financing costs, builders are also citing the negative impacts of higher fuel and material costs, in addition to labor shortages. Cumulatively, we expect these headwinds to keep homebuilding activity subdued over the coming months.
  
  
   

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