Housing starts plunge 17.2%, raising recession fears

The number of housing starts tumbled in March, an indication that the housing market is taking a hit and may be falling into a recession.

Housing starts measure the change in the number of new residential buildings that began construction. Starts fell 17.2% from March 2022 to this past month, according to a Tuesday report from the Census Bureau. They are now at 1.42 million. From February to March, they fell 0.8%.

Additionally, permits to build, which are seen as a proxy for future construction, decreased by 8.8% in March.

“We expect choppiness for single-family construction in the months ahead, with the 2023 data posting significant year-over-year weakness before improving on a sustained basis,” the National Association of Home Builders's chief economist Robert Dietz said. “The multifamily market softened in March, and we anticipate ongoing declines for apartment construction in the months ahead due to tighter lending conditions in the commercial real estate sector.”