July Housing starts rise but still below expectations

Although housing starts rose 1.7% in July to 546,000, the level of starts was below expectations as June housing starts were downwardly revised to 537,000 from an initially reported 549,000. Single-family starts fell 4.2% in July, while the volatile multi-family starts series rebounded by 32.6%. Building permits were also below forecasts falling 3.1% to 565,000 in July.

BOTTOM LINE

It has been months that we have been reporting that housing starts and prices are below expectations.  You would think that people would adjust their expectations. 

We think it will take a few months for the after-effects of the homebuyer tax credit to feed through and, therefore, it will take a few months before we can get a meaningful assessment of the trends in housing construction. In the near term, however, it appears that the chance of a pickup in single-family housing starts is unlikely since single-family permits have fallen for four straight months (the best we can say is that the rate of decline has slowed in June and July). Moreover, the level of single-family starts is modestly below the level of permits. A rebound in housing construction from weather-depressed levels added 0.6 percentage points to second-quarter real GDP growth—at this point, it looks unlikely that housing construction will add to third-quarter growth.

Source RDQ

Comments

Popular posts from this blog

October retail sales come in strong, especially auto sales

Tea Party Buffalo Pictures

How to spot a fake Tea Partier