May 2025
Higher Rates and Rising Costs Drive Starts Down
Constrained housing affordability conditions due to elevated interest rates, rising construction costs and labor shortages led to a reduction in housing production in March. Overall housing starts decreased 11.4% in March to a seasonally adjusted annual rate of 1.32 million units, according to the latest data from HUD and the U.S. Census Bureau. The March reading of 1.32 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months. Within this overall number, single-family starts decreased 14.2% to a 940,000 seasonally adjusted annual rate and are down 9.7% compared to March 2024. The multifamily sector, which includes apartment buildings and condos, decreased 3.5% to an annualized 384,000 pace. On a regional and year-to-date basis, combined single-family and multifamily starts were 8.6% higher in the Northeast, 3.3% higher in the Midwest, 8.5% lower in the South and 10.6% higher in the West. Overall permits increased 1.6% to a 1.48-million-unit annualized rate in March. Single-family permits decreased 2% to a 978,000-unit rate. Multifamily permits increased 9.3% to a 504,000 pace. Looking at regional permit data on a year-to-date basis, permits were 24.7% lower in the Northeast, 4.7% higher in the Midwest, 0.4% higher in the South and 8.8% lower in the West. In March, the number of single-family homes under construction is at 632,000 homes while the count of apartments under construction has fallen to 759,000 units.
Read the Updated Impact Fee Primer As local governments increasingly turn to development impact fees as a funding solution for growth-related infrastructure, it is critical for stakeholders in the building and development industry to push back against these fees being used as a blank-check revenue source. NAHB – in conjunction with Launch Development Financial Advisors – has provided an updated impact fee primer.
Make Preparations Now For Hurricane Season As we approach the 2025 Atlantic hurricane season, this is a good time for businesses, home owners and community leaders to evaluate hurricane risks, update emergency plans, and ensure essential supplies are on hand. Disasters can happen at any time. Acting now can help protect business operations, support employees, and minimize impacts to your business. Don’t delay creating or updating a continuity plan and strengthening your supply chain resilience. Explore preparedness resources by visiting nahb.org/disaster. Ford Pro Joins NAHB's Member Savings Program NAHB is excited to announce the latest addition to the NAHB Member Savings Program: Ford Pro. Through this exclusive program, NAHB members can save up to $5,000 on a wide range of Ford Pro cars, trucks, vans and SUVs. Plus, the member discounts can be combined with local dealership offers. To take advantage of these deals, members simply complete the Ford Pro Discount Request Form at nahb.org/ford. Visit nahb.org/ford to view a list of eligible vehicles, search for participating dealerships and access the discount request form.
President's EOs Promise Reg Reform President Trump in April signed several executive orders aimed at regulatory relief at both the federal and state levels. NAHB has been working closely with the administration to eliminate excessive regulations. The EOs include: Removing state-level impediments to domestic energy production. Rescinding unlawful regulations based on the outcomes of several recent landmark Supreme Court decisions. and Establishing a “Conditional Sunset Date” for certain regulations.
NAHB Evaluates Code Proposals Members of two NAHB Construction Codes and Standards Committee Proposal Oversight Groups (POGs) recently met at NAHB headquarters to review code proposals submitted for Group B of the ICC’s 2024-2026 code development cycle. POGs are working groups overseen by NAHB's Construction Codes and Standards Committee and charged with determining NAHB’s advocacy position on code change proposals going through the ICC code development process. Read the lists of proposals NAHB supports or opposes.
NAHB recently released its NAHB/Westlake Royal Remodeling Market Index (RMI) for the first quarter, posting a reading of 63, down five points compared to the previous quarter. While the reading of 63 is still in positive territory, this is only the second time since the first quarter of 2020 that the RMI has been as low as 63. The NAHB/Westlake Royal RMI survey asks remodelers to rate five components of the remodeling market as “good,” “fair” or “poor.” Each question is measured on a scale from 0 to 100, where an index number above 50 indicates that a higher share view conditions as good than poor. The results of the RMI are seasonally adjusted.
Remodeling Market Index Down 5 Points in First Quarter
Have a Chemical Safety Plan Hazardous chemicals are found everywhere on a home building site and in many commonly used products, such as paints, cleaners, and adhesives. Providing easy-to-read information about their identity and hazards can keep everyone on the job site safe. Chemical identification and hazard notices are also required by OSHA. A strong job site safety plan includes the identification and notices for chemicals as they come onto the site. There are a number of steps that can be taken to ensure all workers are aware of chemical hazards. NAHB has created a chemical safety video that is available in both English and Spanish on nahb.org.
Record Property Tax Collections Property tax revenue collected by state and local governments reached a new high in 2024 and continued as the largest single contributor to state and local revenue. According to the Census Bureau’s Quarterly Summary of State and Local Taxes, state and local property tax revenue totaled $797 billion, up 8.2% from the prior year and making up 38% of all state/local revenue. General sales tax revenue was up 1.2% to $587 billion (28% of the total) while individual income tax totaled $537.4 billion (25.6%), up 4.7% over the year. The sharp rise in property tax collections was driven primarily by the rapid home price inflation seen over 2023 and 2024.
HOY: Midtown Modern Tudor
Alair Homes to Build Show Home for Final IBS in Orlando
NAHB has unveiled exciting new details of its official show home of the International Builders’ Show® (IBS): The New American Home® 2026 (TNAH). The home, produced in collaboration with the NAHB Leading Suppliers Council and Professional Builder magazine, has a special tie to local community services. The 2026 edition, located in Winter Park, Fla., will be the 43rd home in the program’s history and will be built by Alair Homes. TNAH is being built for a specific mission and home owner—Jason Eichenholz, Ph.D., an entrepreneur, philanthropist and the founder of Jonathan’s Landing and CEO and founder of Relativity Networks. Inspired by his son, Jonathan, a young adult with autism, Jason is matching the cost of all contributions from manufacturers and suppliers dollar-for-dollar to support Jonathan’s Landing Foundation, a comprehensive intentional community creating housing and jobs to help adults with Autism Spectrum Disorder (ASD) live with purpose achieve their maximum level of independence. The home is designed by Michael Wenrich Architects, with interior Design by Steele Street Studios and sustainability consultation from Two Trails.
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