Despite a wavering economic recovery amid the persisting COVID-19 pandemic, housing activity enters 2021 on strong footing with increases across almost all indicators.
Single-family housing authorizations increased year over year for the sixth consecutive month—a positive sign, given the severe U.S. housing shortage. Meanwhile, month-over-month activity remained relatively flat, decreasing just 0.36%. This is likely attributable, in part, to rising building material costs and a lack of affordable lots.
Despite increasing new construction, January hit new inventory lows driven by strong homebuyer demand and hesitancy from sellers to list their homes. As a result, existing housing activity experience continued growth in January as homeowners chose (it’s in the past) to invest in their properties rather than to re-enter the market. The combination of low inventory, strong demand, and slowly rising interest rates is likely to lead to a particularly competitive spring homebuying season.
New and Existing Housing Supply Activity, January 2021
- Single-family housing authorizations increased 9.89% year over year.
- Existing housing maintenance volume increased 8.37% year over year.
- Existing housing remodel volume increased 10.04% year over year.
Download the full report to learn how the U.S. housing market performed in the start of the new year.