New figures reported Monday by the U.S. Census Bureau show private investment in single-family residential construction declined from December and year-ago levels as U.S. home builders continue to confront sales and production headwinds.

Single-family construction spending was roughly $25 billion lower than a year ago in January, declining 5.8% to an annual rate of slightly above $410 billion, just 0.2% lower than the pace of private single-family investments in December.

Total residential construction spending in January declined 0.8% over the month to an annual pace of about $945 billion, an increase of 2.3% from a year ago. The latest figures affirm that multifamily construction activity is enjoying a more invigorating start to 2026 than the single-family sector.

Overall private residential construction spending declined 0.8% over the month but posted 2.3% annual growth to land at about $933 billion, as a 0.7% monthly slowdown in new multifamily investments dragged down spending. Public residential investments were flat over the month at $12.2 billion, a 6.8% increase from a year ago.

The Census Bureau recentlu reported that multifamily housing starts were 7.2% higher in January than December and 9.5% higher than a year ago. That compares to a 2.8% monthly and 6.5% yearly decline in single-family housing starts in January, though particularly inclement winter weather impacted builder activity across the U.S. that month.

Beyond February residential construction figures, due to be published by the Census Bureau on May 7, the outlook for housing construction remains highly uncertain amid the cascading economic impacts of the Iran war, started by the U.S. and Israel on Feb. 28.

Mortgage borrowing costs have risen sharply in the weeks since the conflict began. On Friday, the International Energy Agency said “the largest supply disruption in the history of the global oil market” has been unfolding since Iran’s blockade of the Strait of Hormuz. About one-fifth of global oil and liquified natural gas would usually flow through the strait daily.

But the potential for a residential construction slowdown predated the war, with heightened macroeconomic and interest-rate volatility partially stemming from President Donald Trump’s prolonged threats against Greenland’s sovereignty in January.

Permitting activity for single-family and multifamily projects declined by 0.9% and 13.4% from December to January, signaling caution from builders and developers, as permits foreshadow the pace of future starts. Fannie Mae and Freddie Mac raised their multifamily purchase caps to $88 billion for 2026, more than 20% above 2025 levels, to spur activity.

The pace of overall construction spending in January of about $2.19 trillion was 0.3% below revised December estimates but 1% higher than a year ago.