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Economy in Brief

U.S. Housing Starts Reach Highest Level Since 2007; Multi-Family Reach 1989 High
by Tom Moeller  January 21, 2015

Housing starts during all of last year totaled 1.006 million, the highest level since 2007. The 8.0% gain followed double-digit increases during the prior two years. Starts during December rose 4.4% to 1.089 million (AR, 5.3% y/y) from 1.043 million in November, revised from 1.028 million. The latest figure beat expectations for 1.040 million starts in the Action Economics Forecast Survey.

Starts in the single-family sector improved 4.1% last year to 647,000 units following two years of double-digit gain. Last month, starts rose 7.2% (7.9% y/y) to 728,000 and made up a 5.2% drop during November. Notably firm were starts in the multi-family sector which increased 15.6% last year to 357,000, the highest level since 1989. Starts during December slipped 0.8% (+0.6% y/y) to 361,000.

Regionally, starts improved 14.6% last year in the Northeast, the third straight year of double-digit rise. Starts gained 12.5% in December to 126,000 (51.8% y/y). In the West, starts improved 8.6% to 235,000 following two years of double-digit rise. During December, starts rose 5.8% to 292,000 (3.5% y/y). Starts in the Midwest increased 6.8% last year to 159,000, the gain also followed two years of double-digit improvement. In December, starts declined 13.3% to 163,000. Starts in the South improved 6.7% last year to 498,000, also following two years of double-digit rise. Last month, starts gained 8.8% to 508,000 (-1.2% y/y).

Permits to build new homes increased 3.1% last year to 1,022 million. During December permits fell 1.9% (+1.0% y/y). Permits to build single-family homes increased 0.6% in 2014 and rose 4.5% in December (8.1% y/y). Multi-family permits gained 7.5% in 2014 but fell 11.8% last month (-9.9% y/y).

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) Dec Nov Oct Dec Y/Y % 2014 2013 2012
Total 1,089 1,043 1,092 5.3 1,006 925 781
 Single-Family 728 679 716 7.9 647 618 535
 Multi-Family 361 364 376 0.6 357 307 245
Starts By Region
 Northeast 126 112 99 51.8 111 97 80
 Midwest 163 188 165 5.2 159 150 128
 South 508 467 506 -1.2 498 464 398
 West 292 276 222 3.5 235 215 175
Building Permits 1,032 1,052 1,092 1.0 1,022 991 830
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