Permits issued for single-family homes and multifamily buildings — structures that consist of two or more units — also grew at comparable annual rates (20 percent and 19 percent, respectively).1 However, annual permit levels remain well below the levels seen before the Great Recession, as the housing market continues to recover.
In general, increases in permits issued and construction starts may indicate that there is higher current demand for housing or expectations that demand will increase in the future. Growth in permits may suggest that developers and builders feel confident about the economy and businesses' and consumers' willingness to buy real estate. As such, building permits data are seen as a leading indicator of construction activity and of the economy overall.
1 While the BPS separates permits for structures of two to four units and structures of five units or more, we define multifamily units in this analysis as all non-single-family units, i.e., total permits less single-family permits.