Housing starts

RECENT NEWS
Clusterstock  Aug 16  Comment 
WASHINGTON (Reuters) - U.S. housing starts unexpectedly rose in July as building activity increased across the board, supporting the view that investment in residential construction will rebound after slumping in the second...
SeekingAlpha  Aug 16  Comment 
MarketWatch  Aug 16  Comment 
Builders broke ground on more homes than expected in July, but construction still lags levels of earlier economic cycles.
newratings.com  Jul 19  Comment 
BRUSSELS (dpa-AFX) - The Commerce Department is set to release its housing starts and building permits reports for July at 8:30 am ET Tuesday. Economists expect housing starts to come in at a seasonally adjusted annual rate of 1.170 million units,...
Yahoo  Jul 19  Comment 
Groundbreaking surged 4.8 percent to a seasonally adjusted annual pace of 1.19 million units, the Commerce Department said on Tuesday. Economists polled by Reuters had forecast housing starts rising to a 1.17 million-unit pace last month. Housing...
Wall Street Journal  Jul 19  Comment 
newratings.com  Jul 14  Comment 
BRUSSELS (dpa-AFX) - The Commerce Department has released its housing starts and building permits reports for July at 8:30 am ET Tuesday. The greenback traded mixed against its major rivals after these reports. While the greenback rose further...
newratings.com  Jul 4  Comment 
TOKYO (dpa-AFX) - Japan's housing starts declined for the first time in six months in June, though at a slower-than-expected pace, the Ministry of Land, Infrastructure, Transport and Tourism said Friday. Housing starts fell 2.5 percent...
newratings.com  Jul 1  Comment 
WASHINGTON (dpa-AFX) - Partly reflecting a rebound in new residential construction in the Northeast, the Commerce Department released a report on Tuesday showing that U.S. housing starts increased by much more than anticipated in the month of...
Yahoo  Jun 17  Comment 
U.S. housing starts slipped in May as the construction of multi-family housing units dropped, but further gains in building permits signaled a rebound that would support economic growth in the second quarter. Building permits rose 0.7 percent to a...




 
TOP CONTRIBUTORS

Housing starts is a closely-watched indicator of the health of the home construction industry. Homebuilding is a major component of the overall economy due to all its size and its linkages with finance, basic materials, home furnishings and appliances, employment and overall growth.

Source

The Census Bureau, together with the Department of Housing and Urban Development (HUD) jointly report on new residential construction each month. The report has three components: Building permits, housing starts and housing completions. See [[1]]

Image:starts.png


Discussion

  • Housing starts is a measure of the number of privately-owned new housing units that began construction in the reporting month. It is usually reported at the seasonally adjusted annual rate (SAAR). The most recent peak in starts was 1.8 million units in November 2006. In February of 2008 the SAAR was 1,065,000. (These figures include all housing types except mobile homes/manufactured housing.)
  • Before a housing unit is built a building permit is issued. In a sense, building permits are a leading indicator of how many starts there will be in a month or two. In February 2008 the SAAR for permitted units was 978,000, some 7.8% below the revised January rate.
  • Housing completions tells us how many of the homes that were permitted and started have been finished. This measure doesn’t get much attention by the media or most investors. As of February 2008 completions were at the SAAR of 1,208,000, which is about 8.8% below January and 26% below the rate one year earlier.


Note

In general, and for a variety of reasons, starts are usually about 2.5% less than permits and completions are about 4.0% less than starts. The greatest variability is in the multifamily sector, where starts have been 22.5% less than permits (mostly due to reclassification to single-family) and completions have been 7.5% less than starts.

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