The September "New Residential Construction Report," released last week by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, registered both gains and declines in housing construction. The multifamily sector is no longer leading the way, and single-family permits, starts, and completions maintained modest improvements.

Overall permits for privately owned housing declined 5.6 percent to a seasonally adjusted annual rate of 539,000, with overall starts of privately owned units creeping up by 0.3 percent. Total completions of privately owned units, however, rose 7.3 percent to a rate of 648,000.

Following August's double-digit surge in multifamily activity, September's authorizations for units in buildings of five or more units dropped by 26 percent to a seasonally adjusted annual rate of 111,000, and starts of buildings in this sector slid 6.8 percent. But completions of units in buildings of five or more units rose by 16 percent.

Permits for single-family units inched up by 0.5 percent to a seasonally adjusted annual rate of 405,000, while starts climbed to 452,000—a 4.4 percent increase since August. Completions of single-family units in September registered similarly modest improvements: 4.8 percent above August's rate.

According to David Crowe, chief economist at the National Association of Home Builders, this latest data reflects the new-homes market's slow progress toward improved stability in the wake of the home buyer tax credit expiration and the summer's incremental economic growth. He adds that although builders are fielding more inquiries from potential buyers, still-restricted credit is preventing them from responding quickly to increasing demand.

Data from the most recent "New Residential Sales Report" shows that sales of new single-family houses increased by 6.6 percent in September, but sales one year ago were 21.5 percent higher. September's median sales price of new homes was $223,800, while the average sales price was $257,500—both moderate increases over sales prices in August. Inventory is still high, the report finds, with 204,000 new single-family houses for sale at the end of September, which at the current sales rate is an eight-month supply of new housing.