Housing starts

RECENT NEWS
The Hindu Business Line  May 20  Comment 
US stocks had ended mixed on Tuesday, with the Dow rising marginally to a second straight record high, as Wall Street digested housing data that some saw as hopeful for an economy struggling to gr...
newratings.com  May 19  Comment 
WASHINGTON (dpa-AFX) - The dollar is climbing against all of its major competitors Tuesday, extending its gains from the previous session. Today's gains are being driven by the stronger than expected U.S. housing starts report and comments...
newratings.com  May 19  Comment 
WASHINGTON (dpa-AFX) - New residential construction in the U.S. showed a substantial increase in the month of April, according to a report released by the Commerce Department on Tuesday, with housing starts jumping to their highest level in over...
WA Business News  May 8  Comment 
More than 30,000 homes will commence construction in the current financial year, according to the Housing Industry Association’s latest forecast, but its predictions for the next few years exceed those made by the state government’s...
newratings.com  Apr 30  Comment 
TOKYO (dpa-AFX) - Japan housing starts recovered unexpectedly in March, the Ministry of Land, Infrastructure, Transport and Tourism revealed Thursday. Housing starts grew 0.7 percent in March from last year, confounding expectations for a fall...
Wall Street Journal  Apr 16  Comment 
U.S. home building is off to a slow start this year, though builders remain upbeat amid improving weather, steady job creation and low interest rates.
New York Times  Apr 16  Comment 
Starts for single-family homes increased in March, but the gains made only a tiny dent in losses of the previous month.
New York Times  Apr 16  Comment 
U.S. housing starts rose far less than expected in March and factory activity in the mid-Atlantic region grew modestly this month, suggesting the economy could struggle to rebound from a soft patch hit in the first quarter.




 
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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