U.S. Housing Starts & Building Permits Ease in February

Housing starts fell 1.5% (+39.2% y/y) during February to 1.599 million units (SAAR) from 1.624 million in January, revised from 1.567 million. Starts in December were revised down to 1.601 million from 1.626 million. The Action Economics Forecast Survey expected 1.500 million starts.

Starts of single-family starts increased 6.7% (35.4% y/y) to 1.072 million, a new high for the economic expansion. This m/m strength was offset last month, however, by a 14.9% decline (+47.6 y/y) in multi-family starts to 527,000.

By region, last month's weakness in starts was led by a 41.4% decline (+41.6% y/y) in the Northeast to 126,000. It reversed the prior month's 51.4% jump. Starts in the West weakened by 18.2% (+49.0% y/y) to 374,000 and also more than reversed January's increase. Offsetting these declines was a 16.7% (32.1% y/y) to 210,000 starts in the Midwest. It made up most of the prior month's decline. In the South, starts increased 15.2% (36.8%y/y) to 889,000, the highest level since September 2006.

Building permits fell 5.5% (+13.8% y/y) to 1.464 million units from 1.550 million in January. Permits to build single-family homes increased 1.7% (+23.3% y/y) to 1.004 million, the highest level since May 2007, but the gain was countered by an 18.3% decline (-2.7% y/y) in multi-family permits to 460,000.                                              

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

The Mortgage Bankers Association reported that its Mortgage Loan Application Index rose 55.4% (205.2% y/y) during the week ending March 6 after a 15.1% gain in the prior week. The jump occurred as refinancings rose 78.6% (479.2% y/y). Purchase applications also were strong and posted a 5.6% recovery (11.9% y/y) following the prior week's 2.7% decline.

The effective interest rate on a 15-year fixed rate mortgage fell to 2.97% from 3.09% the week before. The rate remained well below its recent peak of 4.71% in early November 2018. The effective interest rate on the 30-year fixed rate mortgage fell to 3.55% from 3.65% the previous week. The effective rate on a 30-year Jumbo mortgage eased to 3.64%, and the rate on the 5-year adjustable rate mortgage fell to 3.17% from 3.31%.

The average mortgage loan size increased to $367,900 last week. The average size of refinancings rose to $372,100, up nearly one-quarter from a year ago. The average loan size for purchases was $354,200 (8.7% y/y).        

Applications for fixed-rate loans rose 151.0% y/y, while applications for adjustable rate loans were up almost 209.5%.

The survey covers over 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for each index is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.