US single-family housing starts rebound in August; building permits fall

US single-family housing starts rebound in August; building permits fall Reuters Thu, September 17, 2026 at 3:19 PM GMT+2 2 min read WASHINGTON, Sept 17 (Reuters) - US single-family homebuilding increased in August, but a drop in permits for future construction suggested the improvement was likely temporary as rising inflation ‌because of the war in the Middle East boosts mortgage rates. Single-family housing starts, ‌which account for the bulk of homebuilding, jumped 7. 6% to a seasonally adjusted annual rate of 918,000 units last ​month, the Commerce Department's Census Bureau said on Thursday.

They rose 5. 2% on a year-over-year basis in August. Single-family building permits fell 1.

8% to a rate of 878,000 units in August. They increased 1. 3% on a year-over-year basis.

Mortgage rates have surged, tracking longer-term US Treasury yields as the US-Israeli war ‌with Iran drove oil prices above $100 ⁠a barrel. Bond yields have also risen amid uncertainty over the Federal Reserve's response to inflation and a ballooning national debt. The yield on ⁠the benchmark 10-year Treasury note is hovering around 5.

0%. The US central bank on Wednesday raised interest rates for the first time since 2023 and flagged further increases in borrowing costs in the months ​ahead. The ​Fed's overnight benchmark interest rate was raised by ​a quarter of a percentage point ‌to the 3.

75%-4. 00% range. The average rate on a 30-year fixed-rate mortgage was 6.

76% last week, the highest level in more than a year, up from 6. 71% in the prior week, data from mortgage finance firm Freddie Mac showed. A National Association of Home Builders survey on Wednesday showed sentiment among single-family homebuilders slumped to a one-year low in September.

The weakness was blamed on rising ‌mortgage rates as well as worsening labor shortages because ​of an immigration crackdown and higher prices for materials ​amid import tariffs. Starts for housing projects with ​five units or more, a very volatile segment, plunged 22. 5% to a ‌rate of 344,000 units in August.

Multi-family ​housing starts decreased 15. 5% ​on a year-over-year basis. Overall housing starts fell 2.

6% to a pace of 1. 275 million units. They decreased 1.

2% on a year-over-year basis in August. Building permits for multi-family ​housing projects dropped 3. 1% to a ‌rate of 467,000 units last month.

Overall building permits fell 2. 7% to a ​rate of 1. 394 million units.

They increased 3. 5% on a year-over-year basis in ​August.