US building permits surge amid increasing demand for new homes

Building permits for privately-owned housing used increased by 9.1% m/m, seasonally adjusted, in December 2021, according to data from the US Census Bureau. This marks the fastest growth of building permits since July 2020. Housing starts increased by 1.4% m/m to 1.7mn for the same period, decelerating from the 8.1% growth in November. Although the most prevalent 1-unit housing type decreased by 2.3% m/m in December, the overall growth was driven by the housing of 5 and more units which increased by 13.7% m/m.

This marks the fastest growth of building permits since July 2020

The US real estate sector is currently facing a mismatch between rising demand for new homes and troubled supply due to a global shortage of raw materials and rising commodity prices. Rising inflation and mortgage rates might also limit the US consumer's opportunity to buy new homes.

More about US housing starts and building permits here