Residential construction starts rise; Invesco venture to deploy $1 billion for apartments; Consumer sentiment improves

The latest Commerce Department data showed total starts for single- and multifamily housing units in June increased 4.6% from the prior month but fell a half-percent short of year-earlier levels. Single-family construction, declining 4.6% for the month and dropping 10% for the year, remained a particular drag on overall residential starts as builders responded to elevated interest rates and other rising costs.

“Single-family building conditions continued to weaken in June as housing affordability challenges caused builder traffic to move lower as buyers moved to the sidelines,” Buddy Hughes, chairman of the National Association of Home Builders, said in a statement regarding the latest data.

Based on seasonally adjusted annual figures, builders as of June were on pace to begin construction on about 1.3 million residential units for full-year 2025. About 883,000 of those would be single-family units and 438,000 would be in multifamily projects.

In contrast with single-family trends, government figures showed June’s pace of multifamily starts picking up considerably after several months of slowing. Starts within projects containing five or more units were up 30.6% from the prior month and increased 25.8% from June 2024.

But reflecting a continued oversupply hangover in some U.S. regions, the builder group noted 739,000 apartments were under construction nationwide during June, including those started in prior months. That was down 18.8% from June 2024, as construction has slowed in several large regions. 

Invesco Real Estate said it has teamed with investment and development firm Bozzuto in a venture planning to deploy up to $1 billion for multifamily properties, targeting East Coast regions, as companies look to capitalize on improving market conditions.

A statement from the firms said the venture closed on its first acquisition, Enders Place, a 220-unit apartment complex in the Baldwin Park neighborhood of Orlando, Florida, for an undisclosed price. The venture plans to invest in renovations of that property as it pursues other East Coast investments expected to total about $330 million in the near term and up to $1 billion in the longer term.

The joint venture will allow the firms “to capitalize on recovering market fundamentals,” said Greg Kraus, managing director and head of U.S. transactions in the Dallas office of Invesco Real Estate. The global investment firm has more than $85 billion in real estate assets under management.

Toby Bozzuto, CEO of Greenbelt, Maryland-based Bozzuto, said the venture will provide capital and financial flexibility to position the companies “to expand purposefully across the East Coast and acquire assets that align with our rigorous investment standards.” 

Consumer sentiment edged higher in July compared with June as households fret somewhat less about potential future inflation spikes caused by new tariffs on imported products. But confidence remained well below year-ago levels in a closely watched national survey by the University of Michigan.

Based on several metrics gauging household finances and the larger economy, preliminary data showed overall sentiment at 61.8 for July, with numbers generally reflecting the percentage of respondents with positive outlooks. That was up from June’s 60.7 but down from the July 2024 score of 66.4 and remained well below the historical average.

A separate July index gauging this month’s economic conditions placed higher at 66.8, but another measuring year-ahead expectations was considerably lower at 58.6. Joanne Hsu, the university’s consumer survey director, said long-run inflation expectations receded for the third straight month, but concerns about the effects of trade and other policy shifts have not disappeared.

“Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future,” Hsu said in a statement. “At this time, the interviews reveal little evidence that other policy developments, including the recent passage of the tax and spending bill, moved the needle much on consumer sentiment.”