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Economy in Brief

U.S. Housing Starts Improvement Is Disappointing
by Tom Moeller  August 16, 2018

Start-up activity in the housing market remained under pressure during July. Total housing starts rose 0.9% last month (-1.4% y/y) to 1.168 million (SAAR). That followed a 12.9% decline in June to 1.158 million, revised from 1.173 million. A rise to 1.259 million starts had been expected in the Action Economics Forecast Survey.

Starts of single-family homes also increased 0.9% (2.7% y/y) last month to 862,000 units, following a 9.0% June decline to 854,000. Starts of multi-family units improved 0.7% (-11.6% y/y) to 306,000 after falling 22.3% to 304,000 in June.

The rise in starts last month was led by an 11.6% increase (7.5% y/y) in the Midwest to 173,000 after a one-third m/m decline during June. Housing starts in the South also firmed as they rebounded 10.4% (4.1% y/y) to 636,000 and made up most of the June decline. Working lower were starts in the West which fell by 19.6% (-10.9% y/y) to 262,000, the lowest level since January 2017. Starts in the Northeast were off 4.0% (-18.5% y/y) to 97,000 after a 4.7% decline.

Building permits improved 1.5% last month (4.2% y/y) to 1.311 million units following a 0.7% June fall. Single-family permits increased 1.9% (6.4% y/y) to 869,000 after a 1.2% June rise. Permits to build multi-family homes gained 0.7% (0.2% y/y) to 442,000 following three straight months of sharp decline.

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

The Financial Crisis at 10: Will We Ever Recover? from the Federal Reserve Bank of San Francisco is available here.

Housing Starts (000s, SAAR) Jul Jun May Jul Y/Y % 2017 2016 2015
Total 1,168 1,158 1,329 -1.4 1,208 1,177 1,107
 Single-Family 862 854 938 2.7 852 785 713
 Multi-Family  306 304 391 -11.6 354 392 397
Starts By Region
 Northeast 97 101 106 -18.5 111 116 135
 Midwest 173 155 239 7.5 180 185 150
 South 636 576 652 4.1 603 585 557
 West 262 326 332 -10.9 314 292 265
Building Permits 1,311 1,292 1,301 4.2 1,286 1,206 1,178
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