Housing Starts Increase Slightly

The housing sector may be on a low trajectory but it is climbing. Starts rose 4.8 percent in June to a 1.189 million annualized rate with permits up 1.5 percent to a 1.153 rate. For single-family homes, starts rose 4.4 percent with permits up 1.0 percent, the latter gain however doing little more than keeping the trend for this reading flat. Multi-family homes, a much smaller category that had been soft earlier in the year, are also showing life, with starts up 5.4 percent and permits putting in a second straight strong showing, up 2.5 percent following May's 4.1 percent jump.

For the second quarter as a whole, starts averaged 1.160 million for a 0.8 percent gain from the first quarter with permits averaging 1.140 for a fractional decline but showing building momentum through the quarter. Housing isn't on fire but it may be making the difference for the economy as a whole, helping it hold in the modest growth range.

Recent History Of This Indicator:
Solid gains are expected for both housing starts and housing permits, with forecasters calling for a 0.5 percent rise in June to a 1.170 million annualized pace for starts and a 1.1 permit gain for permits to a 1.150 million rate that would follow a 0.7 percent gain in May. Still, the trend for permits, in contrast to strength for starts, has been soft with the year-on-year rate in low double-digit contraction. The housing sector has been struggling to gain solid traction this year, embodied by the mixed readings in this report