Housing starts continue its slow and steady pace. We have nothing new here to report, we saw a spike in multifamily construction in the last report which we should have known would pull back. The key is single family resident growth which saw slow growth of 2.9% .
From Census: https://www.census.gov/construction/nrc/pdf/newresconst.pdf
Building Permits:
Privately-owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 1,298,000. This is 5.7 percent (±0.7 percent) below the revised January rate of 1,377,000, but is 6.5 percent (±2.4 percent) above the February 2017 rate of 1,219,000. Single-family authorizations in February were at a rate of 872,000; this is 0.6 percent (±0.9 percent)* below the revised January figure of 877,000. Authorizations of units in buildings with five units or more were at a rate of 385,000 in February.
Housing Starts:
Privately-owned housing starts in February were at a seasonally adjusted annual rate of 1,236,000. This is 7.0 percent (±16.7 percent)* below the revised January estimate of 1,329,000 and is 4.0 percent (±12.2 percent)* below the February 2017 rate of 1,288,000. Single-family housing starts in February were at a rate of 902,000; this is 2.9 percent (±10.8 percent)* above the revised January figure of 877,000. The February rate for units in buildings with five units or more was 317,000.
As we can see below the draw down really came from multifamily construction which was my main critic of last month’s housing start report.
From Calculated Risk:
http://www.calculatedriskblog.com/2018/03/housing-starts-decreased-to-1236.html
We saw a big print in construction jobs in the last jobs report, 61K which probably means some labor is heading toward the hurricane damaged areas. Also, construction job openings rose in the most recent job openings data. The need for labor is coming on two fronts this year which is good for jobs. One note on construction workers in general, we are roughly 500K construction workers away from peak employment of construction workers at the top of the housing bubble. We are also no where close to the peak of the housing bubble total starts too.
From BLS: https://www.bls.gov/charts/job-openings-and-labor-turnover/opening-industry.htm
The key as always is slow and steady growth from single family starts and that trend is still rolling a long higher.
From Doug Short:
https://www.advisorperspectives.com/dshort/updates/2018/03/16/new-residential-housing-starts-down-in-february
Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his own facebook page https://www.facebook.com/Logan.Mohtashami
About Logan Mohtashami:
https://loganmohtashami.com/about/