Housing activity growth slows as consumer confidence wanes

Housing activity showed healthy growth in August, although the pace of growth has decelerated in recent months—an indication of market stabilization.

New and Existing Housing Supply Activity, August 2021

  • Single-family housing authorizations increased 9.05% year over year.
  • Existing housing maintenance volume increased 2.50% year over year.
  • Existing housing remodel volume slightly decreased 0.19% year over year.

Growth in new construction is a positive sign to help alleviate the persistent housing supply shortage. However, building costs remain an issue, as COVID-19 has disrupted construction supply chains, driving inflation higher. While maintenance volumes are up in the existing housing activity category, remodel volumes experienced the first year-over-year decline since June 2020. This slight decline could suggest consumer confidence is waning, as delta variant concerns and inflationary pressures have likely discouraged homeowners from embarking on home renovation projects.

“However, it’s too early to tell if consumers will completely curtail spend in the existing housing stock in the coming months,” says Jonathan Kanarek, managing director of BuildFax, a Verisk business. “We’re closely monitoring how housing activity reacts to shifting consumer behaviors in the next phases of COVID-19.”

Download the full report to learn more about how the COVID-19 pandemic continues to impact the U.S. housing market.