U.S. Housing Starts Surge 11% in February, But Mixed Signals Remain

While the level of housing starts in the U.S. jumped 11% in February from January, other demand signals were quite mixed as the economy moved toward spring time. The level of building permits was down 2% from February of 2024. The annual rate of housing starts (seasonally adjusted) was 1.5 million.

Meanwhile the number of new building permits authorized nationally —a leading indicator of future activity declined by 1.2% from January.

Homebuilder confidence levels declined, according to the National Association of Home Builders survey.

“Builders continue to face elevated building material costs that are exacerbated by tariff issues, as well as other supply-side challenges that include labor and lot shortages,” said NAHB Chairman Buddy Hughes, a home builder and developer from Lexington, N.C.

“Construction firms are facing added cost pressures from tariffs,” said NAHB Chief Economist Robert Dietz. “Data from the HMI March survey reveals that builders estimate a typical cost effect from recent tariff actions at $9,200 per home. Uncertainty on policy is also having a negative impact on home buyers and development decisions.”

Home construction is a major underlying factor in demand for lumber.