Residential construction in the Twin Cities wrapped up December with a marked slowdown, reflecting typical seasonal trends in cold-weather markets. According to the latest Keystone Report data, metro homebuilders pulled 369 permits for single-family homes in December—a 15% drop compared with the same month last year.
Multifamily permitting also slowed sharply, with just 13 units reported, a 63% year-over-year decline, and accounting for less than a quarter of total construction activity for the month.
Across the four comparable weeks of December, 375 building permits were issued for 382 new housing units, indicating a pullback in overall residential construction heading into winter.
Industry leaders point to both seasonal patterns and broader market dynamics.
“December’s slowdown in homebuilding activity aligns with typical seasonal trends in Minnesota, even as some buyers remain cautious,” said Art Pratt, board chair of Housing First Minnesota. Despite the dip, Pratt noted that buyer interest in homeownership remains resilient and could strengthen as market conditions evolve in the year ahead.
For all of 2025, the metro area reported 6,207 permits for 8,052 housing units — a 2% decrease from the previous year. Single-family construction held relatively steady, also declining by roughly 2% compared with 2024 figures.
Looking at specific markets, several suburban cities stood out in December for their permit activity:
- Lakeville led with 51 permits,
- Rosemount followed with 39, and
- Shakopee, Corcoran, and Cottage Grove rounded out the top five. In terms of units authorized, Minneapolis also joined the leaderboard with 19 units permitted.
Housing First Minnesota CEO James Vagle emphasized the broader context for builders and developers: “Economic conditions affected homebuyers this year, but the fundamental need for housing persists. With an undersupplied market, adding housing capacity remains essential.”
As the residential construction industry heads into 2026, builders and industry stakeholders will be watching for signs of renewed activity once typical spring and summer demand returns.