Single-Family Housing Starts Dip; Multifamily Starts Jump

July 22, 2025 |By Michael Tucker-mtucker@mba.org

(Image courtesy of SevenStorm JUHASZIMRUS/pexels)

Housing starts ticked upward in June, driven by a sharp jump in multifamily starts as single-family starts fell compared to May.

The Census Bureau reported 1.32 million starts in June. The figure narrowly exceeded the consensus expectation of 1.3 million.

“Single-family permits sagged for the fourth consecutive month as builders pull back amid mounting challenges, including ongoing affordability issues, rising material costs and tariff-related uncertainties, elevated new-home supply, and growing competition from the resale market,” First American Deputy Chief Economist Odeta Kushi said. “The continued decline in single-family permits, combined with weakened builder sentiment, points to a slowdown in future single-family construction.”

Kushi said the pullback extended to single-family completions as well as starts in June. Completions fell 12.5% from May, further limiting additions an already supply-constrained market.

Last week the National Association of Home Builders reported builder sentiment is inching higher but remained in negative territory for the fifteenth consecutive month. Kushi noted optimism about single-family sales for the next six months increased by three points to 43 and current sales conditions improved by one point. Prospective buyer traffic declined from 21 to 20, marking the lowest reading since 2012, with the exception of three months.

“Affordability challenges and tariff uncertainty continue to weigh on demand,” Kushi said. “Builders are not only facing growing competition from the resale market, but also grappling with elevated inventories of their own. The months’ supply of new homes increased to 9.8 months in May – well above the pre-pandemic 30-year average of around 6 months, and up from 8.3 months in April.”

Multifamily housing starts jumped 30% in June after a 25% drop in May. Wells Fargo Economics, Charlotte, noted the multifamily figure is generally more volatile than single-family starts.