Housing Starts And Permits Fall Back

Housing starts and permits both fell back in December but follow large gains in November. Starts came in at an annualized 1.149 million rate in December for a 2.5 percent monthly dip while permits came in at 1.232 million for a 3.9 percent decline. Yet both of these readings for November surged more than 10 percent. Year-on-year, starts are up a healthy 6.4 percent with permits especially strong at 14.4 million. Housing completions jumped 5.6 percent in the month to edge over 1 million at 1.013 million, reflecting in part favorable weather. This report is below expectations and soft on a historical basis, but readings still point to respectable strength underway for new housing.

Recent History Of This Indicator:
Housing starts & permits have been volatile month-to-month but have been trending higher. Starts, after surging 11 percent in November, are expected to rise a further 2.3 percent in December to a 1.200 million annualized rate, benefiting from unseasonably warm temperatures across most of the country. Permits, also up 11 percent in November but are not subject to weather effects, are expected to ease 5.6 percent.