Friday, July 17, 2009

Housing Starts increase in June from May

by Bill McBride on 7/17/2009 08:30:00 AM

Total Housing Starts and Single Family Housing Starts Click on graph for larger image in new window.

Total housing starts were at 582 thousand (SAAR) in June, up sharply over the last two months from the all time record low in April of 479 thousand (the lowest level since the Census Bureau began tracking housing starts in 1959).

Single-family starts were at 470 thousand (SAAR) in June; 31 percent above the record low in January and February (357 thousand).

Permits for single-family units were 430 thousand in May, suggesting single-family starts might decline some in July.

Here is the Census Bureau report on housing Permits, Starts and Completions.

Building Permits:
Privately-owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 563,000. This is 8.7 percent (±3.0%) above the revised May rate of 518,000, but is 52.0 percent (±3.6%) below the June 2008 estimate of 1,174,000.

Single-family authorizations in June were at a rate of 430,000; this is 5.9 percent (±1.4%) above the revised May figure of 406,000. Authorizations of units in buildings with five units or more were at a rate of 109,000 in June.

Housing Starts:
Privately-owned housing starts in June were at a seasonally adjusted annual rate of 582,000. This is 3.6 percent (±11.3%)* above the revised May estimate of 562,000, but is 46.0 percent (±4.3%) below the June 2008 rate of 1,078,000.

Single-family housing starts in June were at a rate of 470,000; this is 14.4 percent (±11.8%) above the revised May figure of 411,000. The June rate for units in buildings with five units or more was 101,000.

Housing Completions:
Privately-owned housing completions in June were at a seasonally adjusted annual rate of 818,000. This is 0.4 percent (±15.7%)* below the revised May estimate of 821,000 and is 27.7 percent (±9.0%) below the June 2008 rate of 1,131,000.

Single-family housing completions in June were at a rate of 538,000; this is 8.9 percent (±14.7%)* above the revised May figure of 494,000. The June rate for units in buildings with five units or more was 271,000.

Note that single-family completions of 538 thousand are still significantly higher than single-family starts (401 thousand).

It now appears that single family starts might have bottomed in January. However I expect starts to remain at fairly low levels for some time as the excess inventory is worked off.