The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts declined 0.8 percent in August. New residential construction edged down from 1,190,000 units at the annual rate in July to 1,180,000 in August. It is possible that there were some negative impacts from Hurricane Harvey in these data, much as seen in the home builder confidence numbers released yesterday. Outside of weather effects, housing starts have been softer than desired year-to-date, drifting lower since peaking at 1,288,000 units in February. With that said, starts have risen 1.4 percent over the past 12 months, up 1.4 percent since August 2016. Read More
The Census Bureau and the Department of Housing and Urban Development reported that new housing starts rebounded in June after a soft spring. New residential construction rose from an annualized 1,122,000 units in May, an eight-month low, to 1,215,000 in June. Since reaching 1,288,000 units in February, housing starts have pulled back; however, on the positive side, this is the first time activity has exceeded 1.2 million since then, which is encouraging. Homebuilder optimism remains strong despite slipping once again, with respondents to that survey predicting healthy gains in activity over the next six months (see below). I am forecasting growth of 1.28 million starts by year’s end.
Looking at the June data, single-family (up from 799,000 to 849,000) and multifamily (up from 323,000 to 366,000) starts increased in the month, with both at their fastest rate since February, mirroring the headline number. The Midwest and Northeast saw the strongest growth, with only marginal gains in the West, whereas activity slipped in the South. On a year-over-year basis, housing starts rose 2.1 percent from June 2016’s pace of 1,190,000. Single-family starts have jumped 10.3 percent over the past 12 months, up from 770,000 one year ago. In contrast, multifamily starts, which can be highly volatile from month to month, have fallen 12.9 percent over that time frame.
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts weakened again in May, dropping for the third straight month. New residential construction fell from an annualized 1,156,000 in April to 1,092,000 in May, its lowest level since September. Since reaching 1,288,000 units in February, housing starts have pulled back considerably. This report was disappointing, especially since it was expected to rise to exceed 1.2 million again. Perhaps we will see a rebound in the summer months. For their part, the home builder optimism remains strong, with respondents to that survey predicting healthy gains in activity over the next six months. I am also predicting a bounce back in my forecast, which is for 1.25 million starts by year’s end. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts declined 6.8 percent in March. New residential construction activity fell from an annualized 1,303,000 in February to 1,215,000 in March. More importantly, it has exceeded 1.2 million in five of the past six months – a psychological threshold that we appear to have finally sustained. That suggests that the housing market continues to show some strength, even with some notable easing in the latest data. Along those lines, both single-family (down from 875,000 to 821,000) and multifamily (down from 428,000 to 394,000) starts were lower in March, with single-family activity decelerating from a pace not seen since October 2007. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts declined 2.6 percent in January, pulling back a bit after rebounding by 11.3 percent in December. New residential construction activity dropped from an annualized 1,279,000 in December to 1,246,000 in January. Another positive sign was the fact that housing starts have now exceeded 1.2 million in three of the past four months – a psychological threshold that we have struggled to maintain each time. Despite the easing in this report, housing market data remains mostly encouraging, up 10.5 percent over the past 12 months from 1,128,000 in January 2016. Indeed, much of the recent volatility has come from the multifamily segment, ranging from 271,000 units in September to 471,000 in December. In this release, multifamily starts decreased to 423,000 units, up 19.8 percent year-over-year from 353,000 units one year ago.
On the other hand, single-family housing starts have more consistently drifted higher, even with a slight lull in both November and December. Single-family starts rose from 808,000 in December to 823,000 in January. While this was lower than the 868,000 units started in October, its fastest pace since October 2007, the current data represent progress from 775,000 units in January 2016, a year-over-year gain of 6.2 percent. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts rose 11.3 percent in December, largely on a rebound in the multifamily segment. New residential construction activity rose from an annualized 1,102,000 in November to 1,226,000 in December. These data have been highly volatile, especially in the second half of 2016, with starts ranging from 1,052,000 in September to 1,340,000 in October, its fastest monthly pace since July 2007. Much of that volatility stemmed from multifamily activity, which increased from 274,000 in November to 431,000 in December. To further express recent variability, multifamily starts have risen 9.1 percent over the past 12 months, and yet, housing starts for multifamily units fell from an average of 395,333 in 2015 to 384,500 in 2016. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts declined 18.7 percent in November. This was disappointing following the 27.4 percent surge seen in October. New residential construction dropped from an annualized 1,340,000 in October, its fastest monthly pace since July 2007, to 1,090,000 in November. The jump in starts appears to be an outlier, largely from volatility in the multifamily segment. Indeed, here are the multifamily starts data for the last four reports: August (440,000), September (271,000), October (477,000) and November (262,000). Multifamily residential construction starts have averaged 381,455 units year-to-date in 2016, down from 395,333 in all of 2015.
At the same time, single-family starts also decreased in November, down from 863,000 to 828,000, but remain elevated relative to prior months. Through the first 11 months of this year, single-family starts have averaged 781,818 units, up from 712,833 for last year as a whole. In addition, starts in the single-family segment have risen 5.3 percent since November 2015, up from 786,000 units. As such, new residential construction data were perhaps more encouraging than the headline number suggests, especially for single-family activity. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts jumped 25.5 percent in October to the fastest monthly pace since August 2007. New residential construction increased from an annualized 1,054,000 in September to 1,323,000 in October. To be fair, both of those figures are outliers to the year-to-date average of 1,169,100, with September’s surprising fall in activity followed by the strong rebound in October. Yet, the upward movement in this latest report is encouraging. Indeed, both single-family (up from 785,000 to 869,000) and multifamily (up from 269,000 to 454,000) made healthy gains in October, with single-family construction starts reaching a nine-year high. While I would expect a pullback in the November data to something closer to trend, housing starts should exceed 1.2 million by year’s end, which is positive. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts were weaker in August, once again pulling back after passing the 1.2 million units threshold. New residential construction activity decreased from an annualized 1,212,000 units in July to 1,142,000 in August, a decline of 5.8 percent. As such, it stood in contrast to yesterday’s strong jump in home builder confidence from the National Association of Home Builders. That figure suggested that builders were quite optimistic about the next six months, spurred by modest economic growth and historically low mortgage rates. Along those line, I continue to expect 1.21 million housing units started by year’s end despite today’s disappointing numbers for August, particularly for single-family activity. Read More
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts rose to a three-month high in June, recovering a bit from a springtime lull. New residential construction activity increased from an annualized 1,135,000 in May to 1,189,000 in June. This was not far from 1.2 million units, a threshold that the market seems unable to maintain of late. Nonetheless, I would expect 1.21 million housing units started by year’s end. Indeed, residential construction remains one of the brighter spots in the economy, and builders remain mostly upbeat about the next six months, according to the National Association of Home Builders. With that said, housing starts were off 2.0 percent over the past 12 months, mainly from volatility in the multifamily segment. Single-family starts were more indicative of recent strength, up 13.4 percent year-over-year.
In this report, both single-family (up from 745,000 to 778,000) and multifamily (up from 390,000 to 411,000) starts data were higher in June. New single-family residential construction activity grew at its fastest pace since February, and they continue a slow-but-steady trend higher. Single-family housing starts have averaged 776,333 year-to-date in 2016 through June, up from 675,833 for the same time frame in 2015. At the same time, the multifamily starting pace represented a nine-month high, with these figures experiencing large swings from month-to-month. The year-over-year comparison was skewed by an outsized gain in activity in June 2015 to 527,000 units. If you exclude that outlier, multifamily starts rose from an average of 368,800 through the first 5 months of 2015 to an average of 379,167 in the first half of 2016.
Meanwhile, housing permits increased from 1,136,000 to 1,153,000, a four-month high. Permits were slightly higher for both single-family (up from 731,000 to 738,000) and multifamily (up from 731,000 to 738,000) units. Permits are often a proxy for future activity, and in that light, the gain was somewhat encouraging, even if we might prefer faster growth. Much like the housing starts numbers, the year-over-year data were off sharply, down 13.6 percent from 1,334,000 housing permits in June 2015. The prior year’s permitting rate was skewed by strong multifamily activity, as noted above. Excluding that figure, growth in permits has been essentially unchanged, up from an average of 1,140,400 in the first 5 months of 2015 to 1,141,000 in the first half of 2015.