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Total
housing starts surged
in November to their highest seasonally adjusted and annualized rate (SAAR ) since February 2008. Total starts rose to 1.091
million units, an increase of 202,000 units (22.7 percent) relative to October.
That is the largest monthly increase (on an absolute basis) since January 2006.
Single-family starts contributed the lion’s share of the increase, rising by
125,000 units (22.7 percent) to 727,000 units. Multi-family starts rose by
77,000 units (26.8 percent) to 364,000 units.
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Not-seasonally adjusted total starts rose by 5,500 units (7.1 percent) to 82,800 units. Although that
level is lower than several earlier months in 2013, it is noteworthy that
seasonally unadjusted starts rose in November (relative to October) for the
first time since the Census Bureau began keeping records in 1959. It remains to be seen whether November's seasonally adjusted spike is the signal of a new wave of starts. Based on the behavior of lumber futures prices, we suspect not.
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Builders’
apparently concentrated most of their activity starting new
projects, as total completions waned on both seasonally adjusted (-1,000 units,
or 0.1 percent, to 823,000 units) and non-adjusted (-4,200 units, or 5.6
percent, to 70,400 units) bases. Only the multi-family component saw an
increase (SA: +19,000 units, or 9.1 percent, to 227,000 units; NSA: +600 units,
or 3.6 percent, to 17,400 units).
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Seasonal
adjustments seem to have brightened the picture for permits as well, turning
the largest drop in total non-seasonally adjusted permits (NSA: -19,400 units,
or 21.5 percent, to 70,900 units) since November 2008 into a much less dire-looking
SAAR retrenchment (SA: -32,000 units, or 3.1 percent, to 1.007 million units).
Regardless, however, the trend is still pointing up for now.
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The foregoing comments represent the
general economic views and analysis of Delphi
Advisors, and are provided solely for the purpose of information, instruction
and discourse. They do not constitute a solicitation or recommendation
regarding any investment.
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