Homebuilders the Biggest Beneficiary

Homebuilders remain the biggest beneficiary of Covid-19 thanks to the Fed's reaction to it. 

Housing starts, permits, and completions crashed in the initial months of the pandemic, but the Fed goosed housing with a commitment to hold interest rates low until they spot their measure of inflation.

The Census Bureau's New Residential Construction Report highlights the details. 

Building Permits 

  • Privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,766,000. 
  • This is 2.7 percent above the revised February rate of 1,720,000 and is 30.2 percent above the March 2020 rate of 1,356,000. 
  • Single-family authorizations in March were at a rate of 1,199,000; this is 4.6 percent above the revised February figure of 1,146,000.
  • Authorizations of units in buildings with five units or more were at a rate of 508,000 in March. 

Housing Starts 

  • Privately-owned housing starts in March were at a seasonally adjusted annual rate of 1,739,000. 
  • This is 19.4 percent above the revised February estimate of 1,457,000 and is 37.0 percent above the March 2020 rate of 1,269,000. 
  • Single-family housing starts in March were at a rate of 1,238,000; this is 15.3 percent above the revised February figure of 1,074,000. 
  • The March rate for units in buildings with five units or more was 477,000. 

Housing Completions

  • Privately-owned housing completions in March were at a seasonally adjusted annual rate of 1,580,000. 
  • This is 16.6 percent above the revised February estimate of 1,355,000 and is 23.4 percent above the March 2020 rate of 1,280,000. 
  • Single-family housing completions in March were at a rate of 1,099,000; this is 5.3 percent above the revised February rate of 1,044,000. 
  • The March rate for units in buildings with five units or more was 476,000.

Starts and Permits Shatter Expectations

  • The Econoday consensus was 1.620 million starts at a Seasonally-Adjusted Annualized Rate (SAAR) vs the reported 1.739 million starts.
  • The Econoday consensus was 1.750 million permits at a Seasonally-Adjusted Annualized Rate (SAAR) vs the reported 1.766 million starts.

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