Single-family starts rise 7.6% in August as July is revised up

918,000. That was the annual pace at which builders started single-family homes in August, up 7.6% from July and the fastest rate since March, according to the Census Bureau and HUD ^[1]. A 22.5% drop in starts of buildings with five or more units pulled total starts down 2.6%, to 1,275,000 ^[1].

Why it matters: Single-family construction is the part of new supply most buyers compete for. The rebound came as mortgage rates climbed toward 7% and the Fed raised its target range on Sept. 16, so builders were breaking ground into a costlier market ^{[7, 9]}.

By the numbers

• 1,275,000: Total starts at an annual rate, down from a revised 1,309,000 in July and 1,291,000 a year earlier ^[1].
• 1,394,000: Permits, down 2.7% from July but 3.5% above August 2025. Single-family permits fell 1.8% to 878,000 ^[1].
• 1,128,000: Completions, down 11.9% from July and 27.1% from a year earlier; single-family completions fell to 816,000 ^[1].
• 280,000: Units permitted but not yet started, 12.9% more than a year earlier ^[1].
• 6.95%: Freddie Mac’s 30-year fixed average on Sept. 17, up from 6.76% a week earlier; the 15-year was 6.26% ^{[7, 8]}.

What changed about July? The slump looked smaller on second count. The first estimate put July’s total at 1,239,000 and single-family starts at 808,000, which we reported last month as the weakest single-family month in the agencies’ table ^[2]. Thursday’s report revised those to 1,309,000 and 853,000 ^[1]. “Building activity in July was more robust than as originally measured,” First American chief economist Mark Fleming told Scotsman Guide ^[5].

Where the gains were: Single-family starts jumped 23.3% in the Midwest and 28.6% in the West, while they slipped 2.1% in the Northeast and 0.9% in the South ^[1]. Those regional swings carry wide error bands; the West’s monthly change, for example, comes with a range of plus or minus 32.4 percentage points ^[1].

Apartment and condo building went the other way. NAHB put multifamily starts, which count every building with two or more units, at a 357,000 pace, down 21.7% and 14.6% below a year earlier ^[3]. Units under construction of all types totaled 1,271,000, down 3.2% from August 2025, with 589,000 of them single-family homes ^[1].

How does 2026 compare with last year? On an unadjusted basis, builders started 925,100 homes from January through August, 1.0% fewer than in the same months of 2025 ^[1]. Single-family starts were down 4.7% over that stretch, while starts in buildings with five or more units were up 9.7% ^[1]. The revision also reached further back: June’s total now stands at 1,439,000, the highest monthly pace since March ^[1].

What it means for buyers and owners

• Fewer finished homes are arriving. Completions add supply right away, and the single-family pace of 816,000 was 22.9% below a year earlier ^{[1, 3]}.
• Discounts are spreading. In NAHB’s September survey, released Wednesday, 38% of builders cut prices, up from 35% in August, with an average cut of 6%; 66% offered sales incentives ^[4].
• Builder mood is at a one-year low. The NAHB/Wells Fargo index fell three points to 32, its lowest since September 2025, and the gauge of sales expectations for the next six months dropped six points to 37 ^[4].
• Buy-downs are carrying sales. Cotality chief economist Selma Hepp said 80% to 90% of new-home sales “now require mortgage rate buy-downs,” HousingWire reported ^[6].

What’s next: The Census Bureau and HUD publish September construction figures on Oct. 20 ^[1]. Scotsman Guide reported that government estimates of August new-home sales are due next week ^[5].

The other side: Builders and economists disagree less about direction than about degree. Fleming said builders “aren’t stepping on the gas just yet,” citing elevated new-home inventory and incentives “doing much of the work” ^[6]. NAHB pointed to construction costs, lot and labor shortages and “economic uncertainty,” and said year-to-date declines in single-family permits show builders remain cautious ^[3]. Hepp now forecasts starts falling 2% this year and 4% in 2027, and ConstructConnect’s Michael Guckes expects single-family starts to drop 5.9% in 2026, while U.S. Bank’s outlook holds total starts at 1.36 million this year ^[6]. Scotsman Guide, citing the Mortgage Bankers Association, reported that mortgage applications for new homes fell for a fifth straight month in August ^[5].

The Census Bureau’s own caution applies to both camps. “It may take three months to establish an underlying trend for building permit authorizations, six months for total starts,” its explanatory notes say ^[1].