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Builders
started construction of privately-owned housing units in
November at a seasonally adjusted annual rate (SAAR) of 1.090 million (1.230
million expected).
This is 18.7 percent (±6.7%) below the revised October estimate of 1.340
million (originally 1.323 million). The multi-family segment led the decrease: -215,000
units (-45.1%), to 262,000 units. Single-family housing starts declined less
dramatically, by 35,000, to 828,000 units; that was 4.1 percent (±7.5%)* below
the revised October figure of 863,000.
* 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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November’s
total SAAR was 6.9 percent (±7.3%)* below the November 2015 SAAR of 1.171
million units; the not-seasonally adjusted YoY change (shown in the table
above) was -7.9%. Single-family starts were 6.5% higher YoY, but the
multi-family component was 32.8% lower.
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Total
housing completions in November rose by 162,000 units, or 15.4 percent (±13.5%),
to a SAAR of 1.216 million. That was 25.0 percent (±15.0%) above the November
2015 SAAR of 973,000; the NSA comparison: +24.2% YoY.
Single-family
housing completions advanced by 25,000 units, to a SAAR of 774,000; that is 3.3
percent (±8.3%)* above the revised October rate of 749,000 -- and +22.6% YoY. Multi-family
completions rose by 137,000 units (+44.9% MoM, and +27.6% YoY).
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Total
permits fell by 59,000 units, or 4.7 percent (±1.1%), to a SAAR of 1.201
million (1.240 million expected). That was 6.6 percent (±2.6%) below the
November 2015 SAAR of 1.286 million; the non-seasonally adjusted YoY comparison
was -0.9%.
Single-family
authorizations edged up by 4,000 units, or 0.5 percent (±1.4%)*, to a SAAR of
778,000 units; multi-family permits fell by 63,000 units (-13.0%), to 423,000. Single-family
permits were 11.6% higher YoY; multi-family: -16.1%.
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Builder
confidence in the market for newly built, single-family homes in December jumped
seven points, to a level of 70, on the National Association of Home
Builders/Wells Fargo Housing
Market Index (HMI).
“This
notable rise in builder sentiment is largely attributable to a post-election
bounce, as builders are hopeful that President-elect Trump will follow through
on his pledge to cut burdensome regulations that are harming small businesses
and housing affordability,” said NAHB Chairman Ed Brady. “This is particularly important, given that a
recent NAHB study shows that regulatory costs for home building have increased
29% in the past five years.”
“Though
this significant increase in builder confidence could be considered an outlier,
the fact remains that the economic fundamentals continue to look good for
housing,” said NAHB Chief Economist Robert Dietz. “The rise in the HMI is
consistent with recent gains for the stock market and consumer confidence. At
the same time, builders remain sensitive to rising mortgage rates and continue
to deal with shortages of lots and labor.”
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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