The latest data shows that due to a reduction in new projects by home builders, the housing starts in December experienced a 4.3% decline. This means that the scale of housing construction decreased by 70,000 units compared to the previous month, dropping from 1.53 million units in November to 1.46 million units. If the starting rate remains the same as in December every month, the total number of houses built for an entire year is uncertain, as this would need to consider other factors such as seasonal changes and fluctuations in market demand.

This is the first decline in housing starts in the past four months. It is noteworthy that, after reaching a peak of 1.8 million units in April 2022, new starts have been gradually declining. Despite Wall Street's previous prediction of 1.43 million units for December, the actual data exceeded this expectation. These figures have been seasonally adjusted to reflect the true situation.

Specifically, the construction volume of single-family homes in December decreased compared to the previous month, while the construction volume of multi-family homes increased. The construction volume of single-family homes decreased by 8.6%, while the construction volume of apartments increased by 7.5%. This indicates different preferences among builders in planning new projects.

However, builders remain optimistic about future new home sales. The latest survey shows that due to the decrease in mortgage rates, they are optimistic about selling the homes they have started building. In addition, the number of building permits also increased by 1.9%, reaching 1.5 million.

Further analysis of the data reveals that only the construction volume in the western region has increased, while other regions experienced a decline in starts. Overall, the housing starts in the western region, including single-family homes, townhouses, and apartments, increased by 4.7% in December, with a 0.8% increase in the starting rate for single-family homes. Additionally, the number of permits for 2 to 4 unit homes (such as townhouses) increased by 10.6%.

In conclusion, the housing starts rate reversed its significant jump from the previous month due to the decline in newly built single-family homes. However, the decrease in mortgage rates is expected to drive the recovery of housing demand. Meanwhile, the continued lack of resale inventory will continue to push buyers towards new construction, a trend that may promote new home sales and maintain an upward trend in the starting rate in the coming months.