Wednesday, November 19, 2014

Housing Starts decrease to 1.009 Million Annual Rate in October

by Bill McBride on 11/19/2014 08:30:00 AM

From the Census Bureau: Permits, Starts and Completions

Housing Starts:
Privately-owned housing starts in October were at a seasonally adjusted annual rate of 1,009,000. This is 2.8 percent below the revised September estimate of 1,038,000, but is 7.8 percent above the October 2013 rate of 936,000.

Single-family housing starts in October were at a rate of 696,000; this is 4.2 percent above the revised September figure of 668,000. The October rate for units in buildings with five units or more was 300,000.
emphasis added

Building Permits:
Privately-owned housing units authorized by building permits in October were at a seasonally adjusted annual rate of 1,080,000. This is 4.8 percent above the revised September rate of 1,031,000 and is 1.2 percent above the October 2013 estimate of 1,067,000.

Single-family authorizations in October were at a rate of 640,000; this is 1.4 percent above the revised September figure of 631,000. Authorizations of units in buildings with five units or more were at a rate of 406,000 in October.
Total Housing Starts and Single Family Housing Starts Click on graph for larger image.

The first graph shows single and multi-family housing starts for the last several years.

Multi-family starts (red, 2+ units) decreased in October (Multi-family is volatile month-to-month).  Note that permits were strong for multi-family, so multi-family starts will probably increase in November.

Single-family starts (blue) increased solidly in October.

The second graph shows total and single unit starts since 1968.

Total Housing Starts and Single Family Housing Starts The second graph shows the huge collapse following the housing bubble, and that housing starts have been increasing after moving sideways for about two years and a half years.

This was below expectations of 1.025 million starts in October, but this was due to the volatile multi-family sector.

Overall this was a solid report, with a solid increase in single family starts, upward revisions to the previous two months, and a solid increase in permits.  I'll have more later ...