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Economy in Brief

U.S. Housing Starts Decline in August as Multi-Family Weakens
by Tom Moeller  September 17, 2020

• New home building declined m/m but remained higher y/y.

• Building permits eased.

Housing starts declined 5.1% (+2.8% y/y) during August to 1.416 million (SAAR) from 1.492 million during July, revised from 1.496 million. The decline left starts 12.4% below their January peak of 1.617 million. The Action Economics Forecast Survey expected 1.484 million starts in August.

A 22.7% decline (-15.2% y/y) in starts of multi-family units to 395,000 accounted for the drop in starts overall last month. Starts of single-family homes rose 4.1% last month (12.1% y/y) to 1.021 million after surging 10.1% in July to 981,000, revised from 940,000. The latest level was a six-month high, up 50.4% from the April low.

Building permits slipped 0.9% in August (-0.1% y/y) to 1.470 million from 1.483 million in July, revised from 1.258 million. Permits to build single-family homes increased 6.0% (15.6% y/y) to 1.036 million after improving 16.3% in July and 12.6% in June. Permits to build multi-family homes decreased 14.2% (-24.5% y/y) to 434,000 after rising 21.1% in July.

By region, housing starts in the Northeast fell by one-third (-47.0% y/y) to 89,000, the lowest level in three months. In the South, starts declined 17.7% (-2.6% y/y) to 699,000 and reversed half of July's increase. To the upside, in the Midwest housing starts rose 28.4% (40.5% y/y) to 267,000, the highest level since July 2006. Starts in the West improved 19.5% (19.9% y/y) to 361,000, a six-month high.

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) Aug Jul Jun Aug Y/Y % 2019 2018 2017
Total 1,416 1,492 1,265 2.8 1,295 1,248 1,207
  Single-Family 1,021 981 891 12.1 893 872 851
  Multi-Family 395 511 374 -15.2 403 376 356
Starts By Region
  Northeast 89 133 116 -47.0 115 111 112
  Midwest 267 208 210 40.5 170 170 180
  South 699 849 646 -2.6 689 630 602
  West 361 302 293 19.9 322 337 314
Building Permits 1,470 1,483 1,258 -0.1 1,386 1,329 1,285
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