Housing Starts Up in January
February 16, 2018
Single-family housing starts in January were at a rate of 877,000, which is 3.7 percent above the revised December figure of 846,000, according to data from the U.S. Census Bureau and the Department of Housing and Urban Development. Privately-owned housing starts in January were at a seasonally adjusted annual rate of 1,326,000, which is 9.7 percent above the revised December estimate of 1,209,000 and is 7.3 percent above the January 2017 rate of 1,236,000.
Single-family authorizations in January were at a rate of 866,000, a 1.7 percent decline from the revised December figure of 881,000. Privately-owned housing units authorized by building permits in January were at a seasonally adjusted annual rate of 1,396,000, which is 7.4 percent above the revised December rate of 1,300,000 and is also 7.4 percent above the January 2017 rate of 1,300,000.
Single-family housing completions in January were at a rate of 850,000, which is 2.2 percent above the revised December rate of 832,000. Privately-owned housing completions in January were at a seasonally adjusted annual rate of 1,166,000, which is 1.9 percent below the revised December estimate of 1,188,000 but is 7.7 percent above the January 2017 rate of 1,083,000.
Lawrence Yun, chief economist with the National Association of Realtors, was ecstatic over the new data. “Terrific news on housing starts in January with a solid 10 percent gain,” he said. “This rise in single-family housing construction will help tame home price growth, and the increase in multifamily units should continue to help slow rent growth. The large gain in housing starts in the West, 10.7 percent is especially welcomed, as that region has been facing acute housing shortages … This boost in housing supply not only helps the economy, but may also help the Federal Reserve temper the pace of future short-term rate hikes.”
LendingTree Chief Economist Tendayi Kapfidze noted that housing starts were at their highest level since October 2016, but he was more cautious in his data analysis. “The data is quite choppy and best viewed as a moving average to smooth out volatility,” he stated. “Growth is being driven by tight inventory. Inventories are constrained in both the new home and existing markets. Building permits were the highest since 2007 as builders respond to the high demand. Builder confidence is high and construction jobs are increasing, all encouraging signs.”
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