October Housing Starts Fall as Multi-Family Component Tumbles

11:18 AM EST, 01/09/2026 (MT Newswires) -- US housing starts declined in October as a double-digit drop in multi-family units muted gains in the single-family component, delayed government data showed Friday.

Housing starts fell 4.6% sequentially to a seasonally adjusted annual rate of 1.25 million units in October, according to the Census Bureau and the Department of Housing and Urban Development. The data came in below the 1.33 million consensus in a Bloomberg survey.

Starts on buildings with at least five units plunged about 26% month on month in October, while the single-family component increased 5.4%. Consolidated housing starts slumped in the West, according to the data.

For September, consolidated housing starts rose to 1.31 million units from 1.29 million in August.

October and September data were delayed due to the 43-day federal government shutdown that ended in November.

"After a (three)-month delay, today's update on homebuilding activity showed activity moderated heading into the fourth quarter of last year," Andrew Foran, economist at TD Economics, said in a report. "The single-family sector improved for the first time in three months, but remained subdued through the second half of 2025, as elevated financing costs weighed on housing demand."

Building permits, which is a forward-looking indicator of homebuilding, edged 0.2% lower on a monthly basis to about 1.41 million units in October, ahead of Wall Street's view for 1.35 million. Single-family unit permits ticked down 0.5%, while authorizations of units in buildings with five or more units edged 0.4% higher.

Data released last month by the National Association of Home Builders and Wells Fargo showed homebuilder confidence in the US increased in December but remained in negative territory amid rising construction costs and economic uncertainty.

A gradual decline in mortgage rates helped boost new home sales late last year, according to Foran.

"Tariffs on steel, aluminum, copper, and lumber have had a material impact on construction costs according to homebuilder surveys," Foran said. "While this will likely remain a headwind over the near-term, easing financial conditions should provide support to homebuilding moving through 2026."

On Wednesday, President Donald Trump said he was taking steps to ban large institutional investors from buying single-family homes in a bid to make homeownership affordable.

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