Housing starts

RECENT NEWS
newratings.com  Jun 22  Comment 
TOKYO (dpa-AFX) - Japan's housing starts increased for the third straight month in May, the Ministry of Land, Infrastructure, Transport and Tourism revealed Tuesday. Housing starts advanced 5.8 percent on a yearly basis in May, faster than...
newratings.com  Jun 16  Comment 
WASHINGTON (dpa-AFX) - After reporting a sharp jump in new residential construction in the U.S. in the previous month, the Commerce Department released a report on Tuesday showing that housing starts pulled back by more than expected in the month...
Wall Street Journal  Jun 16  Comment 
U.S. builders are preparing to ramp up home construction this summer, underscoring Americans’ growing demand for housing and potentially propelling the economy to stronger growth.
Yahoo  Jun 16  Comment 
U.S. housing starts fell in May after a hefty increase the prior month, but a surge in permits for future construction to a near eight-year high suggested the pullback was temporary and pointed to underlying strength in housing. Groundbreaking...
CANOE.ca  Jun 8  Comment 
Canadian housing starts jumped to the highest level in nearly a year in May, data on Monday showed, an unexpected move that signaled the country's housing boom still has life and that the economy may strengthen in the second quarter.
SeekingAlpha  Jun 7  Comment 
newratings.com  May 29  Comment 
TOKYO (dpa-AFX) - Japan's housing starts increased for the second straight month in April, the Ministry of Land, Infrastructure, Transport and Tourism revealed Thursday. Housing starts grew 0.4 percent year-on-year in April, but slower than...
CANOE.ca  May 25  Comment 
Canada's federal housing agency on Monday gave a cooler outlook for housing starts this year and next, saying that lower oil prices are contributing to differences across the country's regional markets.




 
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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