February 2018 Residential Permits, Starts and Completions

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Builders started construction of privately-owned housing units in February at a seasonally adjusted annual rate (SAAR) of 1,236,000 units (1.284 million expected). This is 7.0% (±16.7%)* below the revised January estimate of 1,329,000 (originally 1.326 million units) and 4.0% (±12.2%)* below the February 2017 SAAR of 1,288,000 units; the not-seasonally adjusted YoY change (shown in the table above) was -2.2%.

Single-family housing starts in February were at a SAAR of 902,000; this is 2.9% (±10.8%)* above the revised January figure of 877,000 (+2.9%). Multi-family starts: 334,000 units (-26.1% MoM; -20.0% YoY).

* 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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Privately-owned housing completions in February were at a SAAR of 1,319,000 units. This is 7.8% (±14.8%)* above the revised January estimate of 1,224,000 and 13.6% (±16.0%)* above the February 2017 SAAR of 1,161,000 units; the NSA comparison: +15.5% YoY.

Single-family housing completions in February were at a rate of 895,000; this is 3.0% (±10.6%)* above the revised January rate of 869,000 (+18.6%). Multi-family completions: 424,000 units (+19.4% MoM; +9.2% YoY). 

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Total permits were authorized at a SAAR of 1,298,000 units (1.324 million expected). This is 5.7% (±0.7%) below the revised January rate of 1,377,000, but is 6.5% (±2.4%) above the February 2017 rate of 1,219,000 units; the NSA comparison: +6.7% YoY.

Single-family authorizations in February were at a SAAR of 872,000; this is 0.6% (±0.9%)* below the revised January figure of 877,000 (+5.7% YoY). Multi-family: 426,000 (-14.8% MoM; +8.9% YoY). 

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Builder confidence in the market for newly-built single-family homes edged down one point to a level of 70 in March from a downwardly revised February reading on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) but remains in strong territory.

“Builders’ optimism continues to be fueled by growing consumer demand for housing and confidence in the market,” said NAHB Chairman Randy Noel. “However, builders are reporting challenges in finding buildable lots, which could limit their ability to meet this demand.”

“A strong labor market, rising incomes and a growing economy are boosting demand for homeownership even as interest rates rise,” said NAHB Chief Economist Robert Dietz. “With these economic fundamentals in place, the single-family sector should continue to make gains at a gradual pace in the months ahead.”

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.