In the midst of a nationwide housing shortage, home construction showed a pronounced growth in Alabama and the nation last month, according to the U.S. Census Bureau.
“Single-family home starts hit a 19-month high of 1.145 million units in November,” said Jeremy Walker, CEO of Alabama Realtors. “That was up 18% from October and 9.3% from November 2022.”
Walker said that there are two factors that could help to continue the trend of growth.
“Decreasing mortgage rates are a key factor in the recent surge of new home construction,” he said. “Potential Federal Reserve rate cuts in 2024 could significantly benefit the housing market and encourage continued growth in new construction.”
Capital Economics property economist Thomas Ryan also addressed the growth.
“The extreme lack of existing inventory on the market continued to support new-build demand and construction activity in November.”
According to Jeffrey Roach, chief economist for LPL Financial, the South is experiencing a higher level of construction of new homes than others. The Census Bureau said there were 849 single-family home start units in the South last month – a 16.9% increase over October.
“Most of the housing starts were in the South as hybrid work continues to be a boon for households seeking lower cost of living,” he said.
The next release of data regarding national and regional housing start numbers will be released Jan. 18 by the Census Bureau.
Austen Shipley is staff writer for Yellowhammer News.
