Housing Starts: Modest Pullback After Strong Gains To End '19

Bottom Line: Housing starts fell modestly in January. much less than expected after strong gains in December. Multifamily starts showed surprising strength, increasing again after unusually strong gains in December. Unseasonably warm weather likely aided starts in January. Single-family starts edged lower but remained on accelerating trends with the three-, six-, and 12-month averages each increasing again. Building permits increased by 9.2% and, while volatile, suggests strength in the coming months. Single-family permits rose modestly while multi-family permits rose moderately. Overall, housing activity appears to be a source of renewed growth for the economy in 2020. Housing Starts FELL by 3.6% in January to 1567k, compared with market expectations for a decline to 1428k. Meanwhile, the prior month was revised modestly higher from 1,608k to 1,626k. Housing starts are now 21.4% ABOVE their year ago level. However, they are still a sharp 31.1% BELOW their January 2006 peak. Single Family Housing Starts FELL by 5.9% to 1010k. Single family housing starts are 4.6% ABOVE their year ago level but still 44.6% BELOW their January 2006 peak. Multifamily Housing Starts ROSE by 0.7% to 557k. Multifamily starts are now 71.4% ABOVE their year ago level.