U.S. Housing Starts & Building Permits Decline Sharply in July
by:Tom Moeller
|in:Economy in Brief
Summary
- Retrenchment in starts led by single-family; multi-family moves higher.
- Starts are mixed m/m throughout the country.
- Building permits return to four-year low.
Total housing starts declined 6.8% (-16.0% y/y) during July to 1.238 million units (SAAR) after rising 1.1% to 1.329 million in June, revised from 1.353 million. Starts declined 4.5% in May to a minimally revised 1.315 million. Starts were 32.3% below the most recent peak of 1.828 million in April 2022 and were at the lowest level since February 2020. The Action Economics Forecast Survey expected 1.35 million starts in July.
A 14.1% decline (-14.8% y/y) in single-family starts to 851,000 led last month’s overall decline as it followed little-change in June at 991,000 and a 4.3% May decline to 992,000. Starts were at the lowest level since March of last year, down 25.0% in the last five months. A 14.5% rise (-18.4% y/y) in multi-family starts to 387,000 countered the single-family decline as it followed a 4.6% June gain to 338,000. It was the highest level of multi-family starts since February. They reached a high of 624,000 units in November 2022.
Starts were mixed last month regionally. In the Northeast, the level of starts rose 42.6% (45.1% y/y) to 164,000 units after rising 15.0% in June. The level of multi-family starts more-than doubled m/m. To the downside, starts in the Midwest eased 1.7% both m/m and y/y to 171,000 following a 16.8% June gain. Starts in the South weakened 13.6% (-20.0% y/y) to 640,000 after edging 0.5% higher during June. It was the lowest level of starts since May 2020. Also declining were starts in the West which fell 12.0% (-31.9% y/y) to 263,000 after weakening 9.1% in June.
Building permits declined 4.0% (-7.0% y/y) in July to 1.396 million units after rising 3.9% in June. It was the lowest level of permits since June 2020. Single-family permits eased 0.1% (-1.6% y/y) to 938,000 in July following five straight months of decline. Multi-family permits were off 11.1% (-16.4% y/y) to 458,000, after rising 16.3% in June.
The housing starts and permits figures can be found in Haver's USECON database. The expectations figure is contained in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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