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Housing Starts: Strong Amid Volatile Revisions But Almost All Due to Hurricanes

December 19, 2017
Bottom Line: Housing starts were stronger than expected in November but were revised lower in October as difficulty tallying starts in the South, heavily impacted by hurricane rebuilding, created volatility. Overall and looking through the volatility, the level of starts remains strong. But the upward momentum of the last few months is almost entirely driven by the South and is unlikely to persist. The trend in the West is just modestly upward, while starts in the Northeast are decelerating on a trend basis and the Midwest is mostly sideways.

Housing Starts ROSE by 3.3% in November to 1297k, compared with market expectations for a decline to 1250k. Meanwhile, the prior month was revised modestly lower from 1,290k to 1,256k.

Housing starts have been slowly climbing, albeit amid substantial volatility, since reaching their cyclical nadir in April 2009 and are now 12.9% ABOVE their year ago level. However, they are still a sharp 42.9% BELOW their January 2006 peak.

Single Family Housing Starts ROSE by 5.3% to 930k. Single family housing starts are 13.0% ABOVE their year ago level but still 49.0% BELOW their January 2006 peak.

Multifamily Housing Starts FELL by 1.6% to 367k. Multifamily starts are now 12.6% ABOVE their year ago level.