Builders
started construction of privately-owned housing units March at
a seasonally adjusted annual rate (SAAR) of 1,321,000 units (1.480 million expected).
This is 14.7% (±9.9%) below the revised February estimate of 1,549,000
(originally 1.521 million units) and 4.3% (±9.4%)* below the March 2023 SAAR of
1,380,000 units; the not-seasonally adjusted YoY change (shown in the table
above) was -2.7%.
Single-family
housing starts in March were at a SAAR of 1,022,000; this is 12.4% (±12.5%)*
below the revised February figure of 1,167,000 units (+22.0% YoY).
Multi-family: 299,000 units (-21.7% MoM; -44.1% YoY).
* 90% confidence interval (CI) is not statistically different from zero. The Census Bureau does not publish CIs for the entire multi-unit category.
Total
completions were at a SAAR of 1,469,000. This is 13.5% (±11.0%) below the
revised February estimate of 1,698,000 (originally 1.729 million units) and 3.9%
(±13.5%)* below the March 2023 SAAR of 1,528,000 units; the NSA comparison: -4.0%
YoY.
Single-family completions were at a SAAR of 947,000; this is 10.5% (±10.1%) below the revised February rate of 1,058,000 units (-8.6% YoY). Multi-family: 522,000 units (-18.4% MoM; +6.4% YoY).
Total
permits were at a SAAR of 1,458,000 units (1.510 million expected). This is 4.3%
below the revised February rate of 1,523,000 (originally 1.518 million units)
but 1.5% above the March 2023 SAAR of 1,437,000 units; the NSA comparison: -5.9%
YoY.
Single-family permits were at a SAAR of 973,000; this is 5.7% below the revised February figure of 1,032,000 units (+6.2% YoY). Multi-family: 485,000 units (-1.2% MoM; -24.5% YoY).
Press
release from NAHB’s Robert Dietz:
“Builder
sentiment was flat in April as mortgage rates remained close to 7% over the
past month and the latest inflation data failed to show improvement during the
first quarter of 2024.
“Builder
confidence in the market for newly built single-family homes was 51 in April,
unchanged from March, according to the National Association of Home Builders
(NAHB)/Wells Fargo Housing Market Index (HMI). This breaks a four-month period
of gains for the index, which nonetheless remains above the key breakeven point
of 50.
“April’s
flat reading suggests potential for demand growth is there, but buyers are
hesitating until they can better gauge where interest rates are headed. With
the markets now adjusting to rates being somewhat higher due to recent
inflation readings, we still anticipate the Federal Reserve will announce
future rate cuts later this year, and that mortgage rates will moderate in the
second half of 2024.
“The
April HMI survey also revealed that 22% of builders cut home prices this month,
down from 24% in March and 36% in December 2023. However, the average price
reduction in April held steady at 6% for the 10th straight month. Meanwhile,
the use of sales incentives ticked down to 57% in April from a reading of 60%
in March.”
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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