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Total
housing starts retreated in November, to a seasonally adjusted and annualized rate (SAAR) of 1.028
million units. That level was 17,000 fewer (-1.6%) than October’s 1.045 million
units (revised up from 1.009 million). All of the decrease in total starts occurred
in the single-family component (-39,000 units or 5.4%); multi-family starts rose
by 22,000 units (6.7%).
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The
year-over-year percentage change in total starts turned negative in November (-7.5%).
Single-family starts were 6.3% below their year-earlier level; the more
volatile multi-family component fell to -9.4%. On a year-to-date (YTD) basis, however,
all components were above levels seen during the same months in 2013.
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Completions
decreased by 59,000 units (-6.4%) in November, to 863,000 units SAAR. Over two-thirds
of the decrease occurred in the multi-family component (-41,000 units or 13.3%);
the single-family component shrank by 18,000 units (-2.9%). Total completions
were 1.0% above their year-earlier level and 15.1% higher YTD than the same
months in 2013.
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Total
permits, which were the bright spot in October, dimmed a bit in November when
decreasing by 57,000 units (-5.2%), to 1.035 million SAAR. The vast majority of
the decrease occurred in the multi-family component (-49,000 units or 11.0%); single-family
permits edged lower (-8,000 units or 1.2%). November total permits were 5.0% below
year-earlier levels but 3.0% higher YTD than the same months in 2013.
The
latest National Association of Home Builders/Wells Fargo Housing Market
Index (HMI) shed one point in December (to 57), two points below
September’s nine-year high. An index value above 50 means more builders feel
the market is good than feel it is poor. “Members in many markets across the
country have seen their businesses improve over the course of the year, and we
expect builders to remain confident in 2015,” said NAHB Chairman Kevin Kelly. “After
a sluggish start to 2014, the HMI has stabilized in the mid-to-high 50s index
level trend for the past six months, which is consistent with our assessment
that we are in a slow march back to normal,” added NAHB Chief Economist David
Crowe. “As we head into 2015, the housing market should continue to recover at
a steady, gradual pace.”
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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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