Macro Flash Report
Housing Data
Takeaway: June’s Housing Starts and Building Permits both rebounded of recent lows and came in above expectations. While this is an encouraging sign after a few months of a downtrend, current levels remain on the lower end of the range which started at the end of 2022.
Looking forward, do not anticipate the housing sector to break out of this range in the near term as underlying demand is offset by inventory and affordability concerns. To this point, the NAHB (National Association of Home Builders) Housing Market Index for the 3rd straight month in July, which was released yesterday. The report suggests that higher-for-longer interest rates remain the primary concern, along with increased cost for construction and development loans.
Housing Starts (white) & Building Permits (blue)
Housing Starts rose by 3% to an annualized rate of 1,353k, above the expectation of a slight increase to 1,300k. Furthermore, May’s data was revised up to 1,314k from the initial reading of 1,277k.
- Single-family units fell by 2% to 980k, the lowest since October 2023.
- Buildings with five or more units jumped 22% to 360k, this highest level since February.
Building Permits increased by 3.4% to an annual rate of 1,446k, above the expected 1,400k increase. May was also revised higher to 1399k, from the preliminary reading of 1,386.
- Single-family authorizations decreased by -2.3%, hitting a thirteen-month low of 934k.
- Buildings with five or more units rebounded sharply, up 19.2% to 460k.