Housing starts

RECENT NEWS
SeekingAlpha  Sep 19  Comment 
By S&P Dow Jones Indices: By David Blitzer August housing starts, reported today, were disappointing at 956,000 units, a drop of 14.4% from July and 8% from August last year. Only twice this year have monthly reports of housing starts topped...
Wall Street Journal  Sep 18  Comment 
U.S. home builders ramped up construction this summer as more families entered the market, but a tumble in August and other obstacles are clouding the sector's outlook.
Clusterstock  Sep 18  Comment 
Housing starts plummeted in August. Starts fell 14.4% to an annualized rate of 956,000. This is the biggest drop since April 2013. Economists were expecting the pace of starts to decline 5.2% to 1.04 milion. Building permits dropped 5.6% to...
newratings.com  Aug 29  Comment 
TOKYO (dpa-AFX) - Housing starts in Japan declined at a faster than expected rate in July, data showed Friday. Housing starts fell 14.1 percent year-over-year in July following the 9.5 percent drop in June, figures from the Ministry of Land,...
SeekingAlpha  Aug 22  Comment 
By John Lombardo, CFA: The initial estimate of July housing starts exceeded expectations as construction began on 1.093 million dwellings on a seasonally-adjusted, annualized basis. Additionally, June starts were revised higher from 893,000 to...
New York Times  Aug 19  Comment 
Other new data indicated that inflation was largely contained, which could give the Federal Reserve room to maintain its ultra-easy monetary policy.
newratings.com  Aug 19  Comment 
WASHINGTON (dpa-AFX) - After reporting a notable decrease in new residential construction for the previous month, the Commerce Department released a report on Tuesday showing a substantial rebound by U.S. housing starts in the month of July. The...
Clusterstock  Aug 19  Comment 




 
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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