Housing Starts and Completions Surge

Mish

Housing starts rose 13.7 percent from September to a seasonally adjusted annual rate (SAAR) of 1.290 million. This is the fastest pace since October 2016. The number of units is 2.9% below the 1.328 million estimate a year ago.

Housing Starts 1960-Present

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The 13% jump is a huge surge but from hurricane depressed levels. It's not all hurricane related. Starts in the West actually declined as this Census Bureau chart shows.

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Regional Variances

The South is the largest region, constituting 48% of the total this month. So while this report is not all hurricane related, there is a noticeable hurricane impact. The next largest region is the West, accounting for 24% of the total.

These regional variants coupled with small sample sizes often provides head-scratching results such as a 42.2% surge in the Northeast even though single-family starts in the Northeast fell 22.4%.

Bond Market Signals

One of the things I watch after these reports is the bond market. The yield on 30-year and 10-year bonds is slightly lower.

The bond market suggests this strength is a bit suspect as was the case in Thursday's Industrial production report. For further discussion, please see Industrial Production Jumps: Another Hurricane Effect?

Mike "Mish" Shedlock

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