Residential Construction Slowed for the Second Consecutive Month in April

New-home construction slowed for the second month in a row during April, revealing the widely anticipated impact of interest rate hikes from the Federal Reserve. Housing starts dropped 0.2% to an annual pace of 1.72 million, while the number of building permits issued fell 3.2% to a 1.82 million rate in April, Realtor.com reports. The most recent downward trend comes after new construction rose to a nearly 16-year high in February, but worsening affordability is forcing some buyers to pump the breaks on new-home purchases. 

Meanwhile, multifamily construction is up 17% to its highest rate since 1986 as builders focus their efforts on big rental projects to satisfy high demand in a heated rental market.

​​While single-family construction has risen 3.7% in the past year, starts on multifamily projects are up a whopping 16.3%.

Most of the new construction is taking place in the South, the fastest-growing region of the country. Starts jumped 10.6% in the South, where about half of all U.S. homes are built nowadays. They also rose 3.3% in The West.

Housing starts tumbled 23% in the Northeast and 22% in the Midwest, the two regions with the slowest amount of residential construction.

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