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Total
housing starts rose in
September to a seasonally adjusted and annualized rate (SAAR) of 1.206 million
units (1.14 million expected)
-- comparable to activity previously seen (other than this past June) in October
2007. September’s level was 74,000 units above (+6.5% ± 16.4%*) August’s 1.132 million
units (revised from 1.126 million). The increase in total starts was split as
follows -- single-family: +3,000 units (+0.3% ± 9.6%*); multi-family: +72,000
units (+18.3%). September marks the fifth consecutive month in which there were
more than 500,000 multi-family units under construction in structures with five
or more units, the longest streak since the mid-1970s.
* 90% confidence interval (CI) is not
statistically different from zero. The Census Bureau does not publish CIs for
the entire multi-unit category.
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Total
starts were 17.8% above their not-seasonally adjusted year-earlier level (single-family:
+11.1%; multi-family: +28.7%). Year-to-date (YTD) comparisons to 2014 were all
in the 11 to 14% range.
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Completions
rose by 72,000 units (+7.5% ± 13.6%*) in September, to 1.028 million units
SAAR. The increase was limited to the multi-family component (+84,000 units or 27.9%);
single-family completions fell by 12,000 units (-1.8% ± 9.9%*).
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Total
permits retreated again in September, falling by 58,000 units (-5.0% ± 1.4%) to
1.103 million SAAR. The decrease fell more heavily on the multi-family
component: -56,000 units (-12.1%); single-family: -2,000 units (-0.3% ± 1.9%*).
YTD total permits were 11.2% above the same months in 2014, driven by the
multi-family component (+18.3%).
The
latest National Association of Home Builders/Wells Fargo Housing Market Index
(HMI) gained 3 points (to 63) in October -- a level comparable to the end of
the housing boom in late 2004. (An HMI value above 50 means more builders feel
the market is good than feel it is poor.) “The fact that builder confidence has
held in the 60s since June is proof that the single-family housing market is
making lasting gains as more serious buyers come forward,” said NAHB Chairman
Tom Woods. “However, our members continue to tell us there are still pockets of
softness in some markets across the nation, and that they face challenges
regarding the availability of lots and labor.”
“With
October’s three-point uptick, builder confidence has been holding steady or
increasing for five straight months. This upward momentum shows that our
industry is strengthening at a gradual but consistent pace,” said NAHB Chief
Economist David Crowe. “With firm job creation, economic growth and the release
of pent-up demand, we expect housing to keep moving forward as we start to
close out 2015.”
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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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