U.S. single-family housing starts declined 9.9% in July to a seasonally adjusted annual rate of 808,000 units, the Commerce Department's Census Bureau reported. The decline marked a 15.7% drop from the same month a year earlier, reflecting persistent headwinds in the residential real estate market.
Total new home starts, including multifamily units, fell 12.4% to an annualized pace of 1.239 million, below the 1.35 million forecast by economists polled by Reuters. The broader measure of new residential construction permits rose 5.0% to a rate of 1.443 million units, exceeding the 1.37 million estimate.
Single-family permits, which signal future construction activity, increased 2.5% to 894,000 units, up 1.1% from July 2025. The data suggests a mixed outlook: while permits point to potential future supply, current starts remain constrained by elevated borrowing costs and limited affordability.
The 30-year fixed mortgage rate stood at 6.77% for the week ended August 7, according to the Mortgage Bankers Association, slightly lower than mid-June levels but still elevated. The National Association of Home Builders has noted that high rates, economic uncertainty, and steep building costs—exacerbated by geopolitical tensions tied to the U.S.-led conflict with Iran—have subdued builder confidence and slowed activity.
The July data underscores the ongoing strain on the U.S. housing market, where affordability constraints and limited inventory continue to dampen demand despite signs of stabilization in permit activity.
