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Economy in Brief

U.S. Housing Starts Falter in December; Permits Hold Steady
by Gerald D. Cohen  February 26, 2019

Total housing starts dropped 11.2% (-10.9% year-on-year) during December to a 1.078 million annual rate (AR), its lowest level in 27 months (this report was delayed as a result of the government shutdown). December starts were substantially weaker than the 1.252 million expected by the Action Economics Forecast Survey. Moreover, starts for October and November were revised down by a total of 50,000.

Both single family -6.7% (-10.5% y/y) and multifamily -20.4% (-11.8% y/y) were hit hard in December. Starts fell in every region of the country except the Northeast where they were unchanged (+21.6% y/y). In the West, starts plummeted 26.3% (-39.7% y/y); in the Midwest they dropped 13.2% (-26.5% y/y); while in the South they were down 6.0% (+6.1% y/y). In the Midwest and West housing starts were at their lowest level since early 2015.

Building permits edged up 0.3% (0.5% y/y) to 1.326 million in December after a slightly-downwardly revised 4.5% gain in November. A 2.2% decline in single-family permits (-5.5% y/y) was offset by the 4.9% rise in multi-family (12.2% y/y).

The housing starts and permits 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 % 2018 2017 2016
Total 1,078 1,214 1,209 -10.9 1,245 1,208 1,177
  Single-Family 758 812 863 -10.5 868 852 785
  Multi-Family 320 402 346 -11.8 376 356 393
Starts By Region
  Northeast 107 107 91 21.6 110 111 116
  Midwest 125 144 186 -26.5 170 180 185
  South 630 670 592 6.1 630 603 585
  West 216 293 340 -39.7 335 314 292
Building Permits 1,326 1,322 1,265 0.5 1,313 1,286 1,206
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