June 2018 Residential Permits, Starts and Completions

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Builders started construction of privately-owned housing units in June at a seasonally adjusted annual rate (SAAR) of 1,173,000 units (1.320 million expected). This is 12.3% (±8.3%) below the revised May estimate of 1,337,000 (originally 1.350 million units) and 4.2% (±10.2%)* below the June 2017 SAAR of 1,225,000 units; the not-seasonally adjusted YoY change (shown in the table above) was -4.1%.

Single-family housing starts in June were at a SAAR of 858,000; this is 9.1% (±8.8%) below the revised May figure of 944,000 (0.0% YoY). Multi-family starts: 315,000 units (-19.8% MoM; -14.8% 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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Completions in June were at a SAAR of 1,261,000 units. This is unchanged (±11.3%)* from the revised May estimate of 1,261,000, but 2.2% (±14.5%)* above the June 2017 SAAR of 1,234,000 units; the NSA comparison: +3.3% YoY.

Single-family housing completions were at a SAAR of 862,000; this is 2.3% (±8.4%)* below the revised May rate of 882,000 (+6.3% YoY). Multi-family completions: 399,000 units (+5.3% MoM; -2.3% YoY). 

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Total permits in June were at a SAAR of 1,273,000 units (1.333 million expected). This is 2.2% (±1.2%) below the May rate of 1,301,000 (originally 1.301 million units) and 3.0% (±1.1%) below the June 2017 SAAR of 1,312,000 units; the NSA comparison: -8.4% YoY.

Single-family authorizations were at a SAAR of 850,000; this is 0.8% (±1.5%)* above the revised May figure of 843,000 (-0.6% YoY). Multi-family: 423,000 (-7.6% MoM; -21.4% YoY). 

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Builder confidence in the market for newly-built single-family homes remained unchanged at a solid 68 reading in July on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). “Consumer demand for single-family homes is holding strong this summer, buoyed by steady job growth, income gains and low unemployment in many parts of the country,” said NAHB Chairman Randy Noel.

“Builders are encouraged by growing housing demand, but they continue to be burdened by rising construction material costs,” said NAHB Chief Economist Robert Dietz. “Builders need to manage these cost increases as they strive to provide competitively priced homes, especially as more first-time home buyers enter the housing market.”

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.