Saturday , December 7 2019
Home / Mish's Global Economic / Housing Slowly Rolling Over: June Permits Down 6.1%, Starts Down 0.9%

Housing Slowly Rolling Over: June Permits Down 6.1%, Starts Down 0.9%

Summary:
Today's new residential construction report spotlights a housing sector that is slowly rolling over. The New Residential Construction report for June isn't all bad news, just mostly bad news. Permits lead the downside. Building Permits Privately‐owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,220,000. This is 6.1 percent below the revised May rate of 1,299,000 and is 6.6 percent below the June 2018 rate of 1,306,000. Single‐family authorizations in June were at a rate of 813,000; this is 0.4 percent above the revised May figure of 810,000. Authorizations of units in buildings with five units or more were at a rate of 360,000 in June. Housing Starts Privately‐owned housing starts in June were at a seasonally adjusted annual rate

Topics:
Mike Shedlock considers the following as important:

This could be interesting, too:

Mike Shedlock writes Huge Difference Between GDPNow and Nowcast Models

Mike Shedlock writes Trump Tweets “Manufacturing Blowout”: What’s the Real Story?

Mike Shedlock writes Jobs Surge in Strike-Ending and Seasonal Adjustment Rebound

Mike Shedlock writes Tory Majority of 48 Based On Latest ComRes Data

Today's new residential construction report spotlights a housing sector that is slowly rolling over.

The New Residential Construction report for June isn't all bad news, just mostly bad news. Permits lead the downside.

Building Permits

Privately‐owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,220,000. This is 6.1 percent below the revised May rate of 1,299,000 and is 6.6 percent below the June 2018 rate of 1,306,000. Single‐family authorizations in June were at a rate of 813,000; this is 0.4 percent above the revised May figure of 810,000. Authorizations of units in buildings with five units or more were at a rate of 360,000 in June.

Housing Starts

Privately‐owned housing starts in June were at a seasonally adjusted annual rate of 1,253,000. This is 0.9 percent below the revised May estimate of 1,265,000, but is 6.2 percent above the June 2018 rate of 1,180,000. Single‐family housing starts in June were at a rate of 847,000; this is 3.5 percent above the revised May figure of 818,000. The June rate for units in buildings with five units or more was 396,000.

Housing Completions

Privately‐owned housing completions in June were at a seasonally adjusted annual rate of 1,161,000. This is 4.8 percent below the revised May estimate of 1,220,000 and is 3.7 percent below the June 2018 rate of 1,205,000. Single‐family housing completions in June were at a rate of 870,000; this is 1.8 percent below the revised May rate of 886,000. The June rate for units in buildings with five units or more was 283,000.

Bond Yields

Bond yield declined across the board on the news.

  • The 10-year yield fell 4.7 basis points to 2.073%.
  • The 30-Year yield fell 4.3 basis points to 2.589%
  • The 5-year yield fell 4.4 basis points to 1.840%
  • The 3-month yield fell 2.5 basis points to 2.134%

Not All Bad

The housing report wasn't entirely awful.

Single-family permits rose a fraction. Single-family starts rose 3.5% but from negative revisions.

Details, however, are not very encouraging.

Single Family Starts and Permits

Single-family starts are down 4.7% compared to a year ago.

Historically, single-family starts and permits are dismal.

Housing Slowly Rolling Over

The housing sector is slowly rolling over.

Despite lower interest rates, homes are not affordable and attitudes towards the ownership society have changed.

Mike "Mish" Shedlock

Mike Shedlock
Mike Shedlock (Mish) is a registered investment advisor representative for SitkaPacific Capital Management (http://www.sitkapacific.com/). Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

Leave a Reply

Your email address will not be published. Required fields are marked *