Thursday, September 17, 2009

Housing Starts in August: Moving Sideways

by Calculated Risk on 9/17/2009 08:31:00 AM

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

Total housing starts were at 598 thousand (SAAR) in August, up 1.5% from the revised July rate, and up sharply 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 479 thousand (SAAR) in August, down 3.0% from the revised July rate, but still 34 percent above the record low in January and February (357 thousand).

Permits for single-family units were 462 thousand in August, suggesting single-family starts will be steady in September.

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

Building Permits:
Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 579,000. This is 2.7 percent (±1.2%) above the revised July rate of 564,000, but is 32.4 percent (±1.3%) below the August 2008 estimate of 857,000.

Single-family authorizations in August were at a rate of 462,000; this is 0.2 percent (±1.1%) below the revised July figure of 463,000.

Housing Starts:
Privately-owned housing starts in August were at a seasonally adjusted annual rate of 598,000. This is 1.5 percent (±7.9%) above the revised July estimate of 589,000, but is 29.6 percent (±6.0%) below the August 2008 rate of 849,000.

Single-family housing starts in August were at a rate of 479,000; this is 3.0 percent (±5.7%) below the revised July figure of 494,000.

Housing Completions:
Privately-owned housing completions in August were at a seasonally adjusted annual rate of 760,000. This is 5.5 percent (±14.0%) below the revised July estimate of 804,000 and is 25.3 percent (±9.6%) below the August 2008 rate of 1,018,000.

Single-family housing completions in August were at a rate of 489,000; this is 1.6 percent (±12.7%)* below the revised July figure of 497,000.
Note that single-family completions of 489 thousand are at about the same level as single-family starts (479 thousand). This suggests residential construction employment has stabilized.

It now appears that single family starts bottomed in January. However, as expected, it appears starts are moving sideways - and will probably stay near this level until the excess existing home inventory is reduced.