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Economy in Brief

U.S. Housing Starts Weaken Unexpectedly
by Tom Moeller  July 18, 2018

Total housing starts declined 12.3% (-4.2% y/y) during June to 1.173 million (AR) from 1.337 million in May, revised from 1.350 million. It was the lowest level of starts in nine months. A rise to 1.320 million starts had been expected in the Action Economics Forecast Survey.

Starts of single-family homes weakened 9.1% (-0.2% y/y) last month to 858,000 units, following a 5.1% May rise to 944,000. Starts of multi-family units slackened 19.8% (-13.7% y/y) to 315,000 units after a 4.0% rise to 393,000 in May.

The decline in starts last month was paced by a roughly one-third shortfall in the Midwest to 156,000 after a one-half increase during May. Elsewhere around the country housing starts also fell, but to a lesser extent. Housing starts in the South were off 9.1% (+13.4% y/y) to 601,000, the lowest level since December. Starts in the Northeast fell 6.8% (-40.0% y/y) to 96,000. Starts in the West eased 3.0% (-3.3% y/y) to 320,000 after a 6.0% decline.

Building permits declined 2.2% (-3.0% y/y) to 1.273 million units following a 4.6% May fall. Single-family permits improved 0.8% (4.6% y/y) to 850,000 after a 2.3% decline. Permits to build multi-family homes were off 7.6% (-15.2% y/y) to 423,000, the third consecutive monthly decline.

The housing starts and permits figures can be found in Haver's USECON database. The expectations figure is contained in the AS1REPNA database.

Can Yield Curve Inversions Be Predicted? from the Federal Reserve Bank of Cleveland is available here.

Housing Starts (000s, SAAR) Jun May Apr Jun Y/Y % 2017 2016 2015
Total 1,173 1,337 1,276 -4.2 1,208 1,177 1,107
 Single-Family 858 944 898 -0.2 852 785 713
 Multi-Family  315 393 378 -13.7 354 392 397
Starts By Region
 Northeast 96 103 96 -40.0 111 116 135
 Midwest 156 243 160 -23.5 180 185 150
 South 601 661 669 13.4 603 585 557
 West 320 330 351 -3.3 314 292 265
Building Permits 1,273 1,301 1,364 -3.0 1,286 1,206 1,178
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