 | Housing starts increased 9.3% in November to 685,000 units at an annual rate |
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| Posted Under: Data Watch • Home Starts • Housing |
Implications: Great news! The turning point in home building has clearly arrived. Homes were started at a 685,000 annual rate in November, while building permits hit a 681,000 annual rate. Both of these results easily beat consensus expectations and, except for one month affected by the homebuyer tax credit, are the fastest rates in three years. The gain in starts in November was mostly due to multi-family units, which soared 25.3%. These starts might fall back next month, but, given the general trend away from owner-occupancy and toward rental occupancy, multi-family should continue to generally trend higher. Meanwhile, single-family starts were also up in November and the six-month average for starts has been moving up. Except for the artificial homebuyer credit, this is the first consistent upward trend since the collapse of building activity started in early 2006. Gains in starts are beginning to filter through to the number of homes under construction, which have gone up three months in a row. This is a major break from the recent past. From 2006 through five months ago there had been no increases at all. Based on population growth and "scrappage," home building must increase substantially over the next several years to avoid eventually running into shortages. For more on the housing market, please see our recent research report (link). In other good news this morning, last week's (same-store) chain store sales were up 4.6% from a year ago according to the International Council of Shopping Centers and up 3.4% according to Redbook Research.
Click here for the full report.
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