New Residential Housing Starts Up in June

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts.

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts. The latest reading of 1.215M was above the Investing.com forecast of 1.155M. Figures going back to April were revised.

Here is the opening of this morning's monthly report:

Building Permits

Privately-owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,254,000. This is 7.4 percent (±1.1 percent) above the revised May rate of 1,168,000 and is 5.1 percent (±1.4 percent) above the June 2016 rate of 1,193,000. Single-family authorizations in June were at a rate of 811,000; this is 4.1 percent (±0.8 percent) above the revised May figure of 779,000. Authorizations of units in buildings with five units or more were at a rate of 409,000 in June.

Housing Starts

Privately-owned housing starts in June were at a seasonally adjusted annual rate of 1,215,000. This is 8.3 percent (±15.8 percent)* above the revised May estimate of 1,122,000 and is 2.1 percent (±14.0 percent)* above the June 2016 rate of 1,190,000. Single-family housing starts in June were at a rate of 849,000; this is 6.3 percent (±13.5 percent)* above the revised May figure of 799,000. The June rate for units in buildings with five units or more was 359,000. [link to report]

Here is the historical series for total privately-owned housing starts, which dates from 1959. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.

Housing Starts

The Population-Adjusted Reality

Here is the data with a simple population adjustment. The Census Bureau's mid-month population estimates show substantial growth in the US population since 1959. Here is a chart of housing starts as a percent of the population. We've added a linear regression through the monthly data to highlight the trend.

Housing Starts Population-Adjusted

A Footnote on Volatility

The extreme volatility of this monthly indicator is the rationale for paying more attention to its 6-month moving average than to its noisy monthly change. Over the complete data series, the absolute MoM average percent change is 6.3%. The MoM range minimum is -26.4% and the maximum is 29.3%.

For visual confirmation of the volatility, here is a snapshot of the monthly percent change since 1990.