FYI: We all know that it has been a rough winter, but today’s Housing Starts report for the month of February took the market entirely by surprise. While economists were forecasting starts to come in at a seasonally adjusted annualized rate (SAAR) of 1040K, the actual level came in at 897K. This was the biggest miss relative to expectations since February 2007, and the fourth weaker than expected report in the last five months. While the headline Housing Starts number was atrocious, Building Permits actually came in better than expected (1,092K vs 1,065K). The fact that starts were so weak even as permits held up suggests that at least some of the weakness in this month’s report was weather related. Another indicator suggesting weather impacted February’s reading is that the headline number of 897K was the same level we saw last January, which was also one of the harshest months of last winter.
As shown in the charts below, both multi-family and single family Housing Starts were weak this month, although single-family starts (-14.9%) were down less than the headline reading while multi-family units (-20.8%) declined more. On a year/year basis, single-family units were actually up slightly. For Building Permits, the strength was the other way around, where February’s growth was driven by multi-family units (+18.3% m/m) over single-family units (-6.2%).
Regards,
Ted
https://www.bespokepremium.com/think-big-blog/housing-starts-buried/
