Single-family housing starts unexpectedly rose in September despite mortgage rates over 7%, driven by limited resale inventory that led buyers to new construction.

As reported in a news release from the National Association of Home Builders (NAHB) that was distributed on October 18, housing starts increased by 7% in September to a seasonally adjusted annual pace of 1.36 million units. This information was derived from the data collected by the United States Department of Housing and Urban Development as well as the United States Census Bureau. Construction of single-family homes showed a year-over-year growth of 3.2%, reaching a total of 963,000 units at the seasonally adjusted annual rate.

In a press statement, NAHB Chairman Alicia Huey stated that she was "somewhat surprised" by the increase in production of single-family homes. "Our latest builder surveys indicate that starts are likely to weaken in the months ahead due to recent higher mortgage rates that were near 7.6% in mid-October."

The news release also included statements from Robert Dietz, the chief economist for the NAHB. He stated that "Because there is a lack of existing homes in the marketplace, 31% of homes available for sale in August were new construction." This is in contrast to the normative range that was seen in the past, which was between 12 and 14 percent.

The National Association of Home Builders (NAHB) reports that there has been a fall in the number of home starts across the country. The NAHB reports that the number of house starts has decreased by 23.3% in the Northeast, 12.9% in the Midwest, 7.8% in the South, and 16.9% in the West. According to the press release, the number of permits issued for single-family homes went up by 1.8% compared to the previous month but fell by 13.4% compared to the same time period in the previous year.