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Economy in Brief

U.S. Housing Starts Decline, Erasing Year's Increase
by Tom Moeller June 16, 2010

If there was any question that the government's program to stimulate housing was a success, it should be laid to rest now that it's ended. May housing starts plummeted 10% m/m to 593,000 (AR), the lowest level since December. The April level was revised down modestly. The latest figure was well short of Consensus expectations for 648,000 starts but despite the decline, starts remain up 21.5% from the low in January 2009.

Starts of single-family homes fell 17.2% from April to 468,000, the lowest level in twelve months. In the South, single-family starts fell by one-quarter (+10.1% y/y) while starts in the Midwest dropped 10.9% (+15.5% y/y). In the Northeast starts fell a lesser 1.7% (+54.1 y/y) and were off 2.0% (+11.1 y/y) in the West.

Activity in the the multi-family sector continued to improve and starts of apartments, condominiums & town houses jumped by one-third to 125,000, the highest level in twelve months.

Building permits during fell 5.9% to the lowest level in one-year. Permits to build a single-family home repeated their April decline and fell roughly 10.0% (+3.1% y/y). Permits to build multi-family homes increased 9.7% and were 26.0% higher than the low last July.

The housing starts figures can be found in Haver's USECON database.


Housing Starts (000s, SAAR) May April March May y/y 2009 2008 2007
Total 593 659 634 7.8% 554 900 1,342
Single-Family 468 565 535 15.3 442 616 1,036
Multi-Family 125 94 99 -13.2 112 284 306
Building Permits 574 610 685 4.4 583 896 1,392
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