Dive Brief:

• Builders will break ground on 1.1 million homes, including 715,000 single-family units, this year, research company Metrostudy predicted on Monday.

• In a nod to the continued strength of the rental market, the firm’s first-quarter Home Building Outlook forecast 385,000 multifamily starts.

• New home sales will increase by 18.8% over 2014,  as builders will sell 437,000 dwellings by the end of the year, the report predicted. The South—especially Houston, Dallas and Atlanta—will dominate home sales.

Dive Insight:

The forecast for an “eventual rising new home demand” is cautious because of the reluctance so far of young adults—who traditionally would have become homeowners by now—to purchase property. However, Brad Hunter, Metrostudy’s chief economist, said he sees evidence that millennials who rent apartments with roommates are beginning to strike out on their own, which will increase the demand for for-sale housing.

Plus, Hunter noted, “As rising rents eventually hit the pain point, more people will begin to consider homeownership again.”