Spike in new housing started in October because of millennials
New home construction in the U.S. has jumped to a nine-year high, according to new data from the Census Bureau.
In October, new housing construction was 25 percent above September, for a seasonally adjusted annual rate of 1,323,000. That’s 23.3 percent above the October 2015 rate.
The reason, Nationwide Chief Economist David Berson says, is millenials:
“With improved employment and income prospects, millennials are an expanding portion of housing demand as they move out of their parents’ homes — increasingly to form families.”
On the other hand, there is the ever-looming specter of a President-elect Donald Trump. Here’s what Zillow’s Chief Economist Ralph McLaughlin said:
“A big question heading into 2017 is how homebuilders will fare under a Trump administration. While we think some of his broader economic policies might hurt builders, such as immigration and trade policies that could restrict both labor supply and raw materials, we also think he’ll likely implement builder-friendly policies, such as infrastructure stimulus and financial sector reform.”
Next week, we’ll see how much of that new housing came to Denver when metropolitan-area data is released. Could be interesting given that millennials are finally starting to buy homes and they’re doing it in Denver.