US new home construction down by 16.5% in April

16 May 2013 14:37  [Source: ICIS news]

WASHINGTON (ICIS)--New US home construction fell by 16.5% in April from March, the US Commerce Department said on Thursday – including a 2.1% decline in the key single-family housing sector and a sharp 37.8% plummet in apartment building work.

In its monthly report on new residential construction, the department said that there were 853,000 housing starts last month on a seasonally adjusted annual basis.

That figure is 16.5% below the downwardly revised March estimate of 1.021m housing starts, although it is still 13.1% higher than the pace of new home construction seen in April 2012.

The March 2013 housing starts originally had been estimated at 1.036m.

The 16.5% decline in housing construction last month was driven chiefly by the nearly 38% nose-dive in work on multi-family apartment buildings.

The core housing market – construction of new single-family homes – also edged lower last month, down by 2.1%.

Although housing starts had seen an encouraging 7% gain in March from February, that advance was wholly due to a bump in apartment construction, while single-family housing starts saw a 5% drop in that month.

The housing market is a key downstream consumer sector for the chemicals industry, driving demand for a wide variety of chemicals, resins and derivative products such as plastic pipe, insulation, paints and coatings, adhesives and synthetic fibres.

The American Chemistry Council (ACC) estimates that each new home built represents some $15,000 (€11,550) worth of chemicals and derivatives used in the structure or in production of component materials.

In contrast to the sharply downward numbers on new home construction in April, the department said that building permits issued during the month suggest housing work could show an upturn when the May data is available.

The number of building permits issued last month was up by 14.3% compared with March.

That included a 3% increase in permits for single-family home construction and a nearly 41% jump in permits for apartment projects.

Building permits are issued by local governments when contractors are ready to break ground and begin construction of a residential structure, so monthly permitting data is seen as an indicator of the housing sector’s near-term prospects.

US Housing Starts


Apr ’13

Mar ’13

Mar-Apr ’13

Apr ’12

Apr ’12 to   Apr ’13

US Housing Starts

853,000*

1.021m*

-16.5%

754,000*

13.1%

* Seasonally adjusted & annualised

($1 = €0.77)


By: Joe Kamalick
+1 713 525 2653



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