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Economy in Brief

U.S. Housing Starts Recover Modestly
by Tom Moeller  April 19, 2011

It was a rough winter for the housing sector. The latest indication is the only moderate 7.2% m/m rebound in seasonally-adjusted housing starts last month following a 18.5% February plunge. The rise brought the level to 549,000 (AR) units from an upwardly-revised 512,000, initially reported as 470,000. The January figure also was revised up slightly. Despite the weather, starts during Q1 managed a 5.4% q/q increase after the 9.2% Q4 decline. Moreover, the rise in March starts outpaced expectations for a gain to 527,000.

Despite these increments, the latest figures underscore housing's difficulty generating forward momentum. The rise in March starts was paced by a 7.7% gain in single-family activity to 422,000. That mostly recovered a lessened 8.8% February drop, but for the quarter, starts declined 4.8% to the lowest level since the recession trough two years ago. Starts last quarter were notably weak in the Northeast which fell by one-quarter from Q4.

Activity in multi-family starts recently picked up. In March, starts rose 5.8% from February. Coming on the heels of a surge in January, the gain was enough to lift the quarterly average by one-half versus Q4. Starts of 2-4 units building rose moderately but starts of larger buildings with 5-or-more units rose by more than one half.

Building permits also recovered 11.2% last month but for the quarter they fell 1.9%. Like starts, weakness in permits last quarter was led by a 4.3% decline in the single-family sector from Q4 versus a 4.8% rise in multi-family.

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

Housing Starts (000s, SAAR) Mar Feb Jan Feb Y/Y 2010 2009 2008
Total 549 512 628 -13.4 585 554 900
 Single-Family 422 392 430 -21.1 471 442 616
 Multi-Family 127 120 198 28.3 115 112 284
Starts By Region
 Northeast 59 56 92 -10.6 72 61 120
 Midwest 82 62 113 -11.8 98 95 134
 South 297 307 305 -12.4 296 281 451
 West 111 87 118 -18.4 121 117 195
Building Permits 594 534 563 -13.3 595 583 896
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