Single-Family Starts And Permits Inched Higher In July — But Not Enough
The slight monthly boost comes as builders continue to face cooled buyer demand in response to elevated mortgage rates and high home prices. Housing starts and completions are not on track to meet national inventory needs this year with builder sentiment low.
Housing starts and building permits for single-family homes experienced a slight boost in July, even as builders continued to battle economic headwinds.
Building permits for privately-owned housing units overall declined, dipping 2.8 percent below the June 2025 rate and 5.7 percent below the July 2024 rate to a seasonally adjusted annual rate of 1.354 million, according to the U.S. Census Bureau and U.S. Department of Housing and Urban Development.
Single-family building permits saw modest growth during July, hitting a rate of 870,000, up 0.5 percent from the previous month, but still down 7.9 percent year over year.
Overall housing starts were up 5.2 percent from June 2025 and up 12.9 percent than July 2024’s rate to a seasonally adjusted annual rate of 1.428 million.
Meanwhile, single-family housing starts were also up 2.8 percent month over month and up 7.8 percent year over year to a rate of 939,000.
“Despite a modest uptick after a four-month streak of declines, single-family permits — a leading indicator of future construction — remain near their lowest level since March 2023, signaling continued weakness in the sector,” First American Deputy Chief Economist Odeta Kushi said in a statement emailed to Inman.
“The monthly increase in housing starts and permits is a welcome development, but one data point doesn’t make a trend,” Kushi continued. “Sustained gains are needed to demonstrate continued progress in single-family homebuilding. The housing market remains structurally undersupplied, and we need more hammers at work to build the homes that are still in short supply.”
Housing completions made monthly gains, increasing 6 percent from June 2024’s rate, but were down 13.5 percent from July 2024 to a seasonally adjusted annual rate of 1.415 million.
Single-family completions rose 11.6 percent from June and declined 6.1 percent year over year for a rate of 1.022 million.
The report arrives as builders continue to face challenges in home sales due to elevated mortgage rates and high home prices, which have cooled buyer demand. Although the average 30-year fixed-rate mortgage rate dipped to 6.58 percent last week — its lowest level since October — that rate is still much higher than those that buyers remember from immediately before the COVID-19 pandemic.
Lower demand is dissuading builders from breaking ground on new projects, more than one-third of builders are now using price cuts to try and attract buyers and two-thirds are trying a variety of incentives, according to a National Association of Home Builders survey released on Monday.
“There’s no other way to say it: U.S. home construction is in a funk,” Heather Long, chief economist at Navy Federal Credit Union, said in a statement emailed to Inman.
“The nation desperately needs more homes that are affordable, but home construction is depressed and is only likely to get worse in the months to come. Housing starts and completions are on track to be barely above 1.4 million for this year, and building permits have fallen below that anemic level, meaning next year could be even worse for home building. The United States needs roughly two million new homes built a year to keep up with demand and need, but builders aren’t going to boost production at a time when costs are rising and mortgage rates remain so high that buyers are scared to purchase anything right now.”
