Residential construction declined in March as builders reduced the number of projects launched during a critical spring housing season.
Housing starts fell 11.4% from the previous month to a seasonally adjusted annual pace of 1.324 million units, according to data from the Census Bureau released Thursday. That fell below the median estimate of economists surveyed by Bloomberg, who expected an annualized 1.42 million pace. Single-family housing starts dropped 14.2 % at a seasonally adjusted annual pace of 940,000.
March’s decline comes as builders try to navigate a complex landscape, which has been made uncertain due to unresolved trade policies with Canada, Mexico, and China. This uncertainty has weighed down builders’ outlook this year.
Builders have cited rising costs for building materials due to tariffs. Data from the National Association of Home Builders found that 60% of builders said their suppliers have already hiked prices or are planning to increase them due to trade levies.
Meanwhile, building permits gained 1.6% from a month earlier to an annualized rate of 1.482 million. At the same time, mortgage rates remain unstable, with some metrics showing rates approaching 7%, highlighting the ongoing challenges prospective buyers face.