Homebuilders can’t start what isn’t permitted.
The New Residential Construction Report for July shows a decline in permits but a rise in housing starts and completions.
Building Permits
- Privately-owned housing units authorized by building permits in July were at a seasonally adjusted annual rate of 1,354,000. This is 2.8 percent below the revised June rate of 1,393,000 and is 5.7 percent below the July 2024 rate of 1,436,000.
- Single-family authorizations in July were at a rate of 870,000; this is 0.5 percent above the revised June figure of 866,000. Authorizations of units in buildings with five units or more were at a rate of 430,000 in July.
Housing Starts
- Privately-owned housing starts in July were at a seasonally adjusted annual rate of 1,428,000. This is 5.2 percent (±14.7 percent) above the revised June estimate of 1,358,000 and is 12.9 percent (±13.6 percent) above the July 2024 rate of 1,265,000.
- Single-family housing starts in July were at a rate of 939,000; this is 2.8 percent (±11.8 percent) above the revised June figure of 913,000. The July rate for units in buildings with five units or more was 470,000.
Housing Completions
- Privately-owned housing completions in July were at a seasonally adjusted annual rate of 1,415,000. This is 6.0 percent (±13.5 percent) above the revised June estimate of 1,335,000, but is 13.5 percent (±10.8 percent) below the July 2024 rate of 1,635,000.
- Single-family housing completions in July were at a rate of 1,022,000; this is 11.6 percent (±14.6 percent) above the revised June rate of 916,000. The July rate for units in buildings with five units or more was 385,000.
Note the Trends and Margins of Error
The margins of error in these reports are high. The Census Department does not have a lot of faith in these estimates and neither do I.
However, some trends are easy to spot. For example, permits keep dropping and are now down 29.5 percent from the January 2022 high of 1.92 million.
You can’t start what isn’t permitted.
Completions rose in July but are down 19.4 percent from the August 2024 high. Completions feed GDP.
Housing Starts Single Family vs Multi-Family
Single-family housing starts are in the middle of a broad range since November 2022. The low end of the range is 795,000 and the upper end is 1.14 million.
Existing-Home Sales Decline 2.7 Percent
On July 23, I reported Existing-Home Sales Decline 2.7 Percent, Median Price New Record High
Hooray, higher prices? That’s the message from the NAR.
That alleged Median Price Record did not happen. The NAR does a terrible job at seasonal adjustments (if it tries at all).
Click on above link for discussion. And expect rapid decline now in NAR median prices.
The Housing Top Is Likely In, Case-Shiller Home Prices Drop Again
On July 29, 2025, I reported The Housing Top Is Likely In, Case-Shiller Home Prices Drop Again
The Case-Shiller Home Price Index declined another 0.3 percent in May.
Prices have dropped, but the Case-Shiller National index is up 52.1 percent since January 2020.
The decline is barely noticeable.
Buyer Traffic Very Low
Yesterday, I commented Wells Fargo Housing Market Index Remains Weak, Buyer Traffic Very Low
The use of sales incentives was 66% in August, up from 62% in July and the highest percentage in the post-Covid period.
Housing cannot gain traction as mortgage rates are still too high and prices remain out of sight.
Here’s a related article to construction. Bring in the robots!
Well, there’s the 240,000 illegal immigrants that didn’t arrive in 2025.
That’s 240,000 so far this year that don’t need housing.
Plus there’s the 1,600,000 already illegally here that thought it would be best to leave.
Then there’s the Millennials and Gen Z that can barely afford to rent let alone provide a market for builders. .
I have a project that I have had on hold because the contractors were working at capacity. I mentioned to several that I wanted to do this rebuild of an outbuilding when things slowed down and they should call me when they wanted work.
Three have called in the last month and now we are finishing details of the design and moving forward with bids.
It is good to have the contractors back in the hungry mode as costs drop when there is competition for work.
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I also pulled the money for the project (and more) out of the market Monday and today. I am not at all comfortable with the valuations of AI or tech companies that are in bubble territory.
Intel is on life support and getting a government bailout. Yikes!
They have built all these mega factories and need cutting edge AI chips in order to get investors attention.
New oilfields are treated like divers. Oil have to be decompressed from 30,000
feet below seafloor, from harsh environment, to seafloor. Thereafter, to sea level. New oilfields are an expensive casino. In the long run, after capex, gamblers can extract oil from harsh environment, but they cannibalize themselves. New oil fields, Canadian TMX are threatening OPEC and Putin. He needs the money to finance a war.
Banks borrow o/n to lend and o/n to repay. Small innovative co benefit from higher rates. Higher rates prohibit raiders from taking over. Higher rates keep them alive. Higher productivity increases value. Old and rusty is toasted. Onshore rejuvenation with robotic and AI increase productivity and value. It’s a new beginning. The gov took it to the chin for two decades to preserve the system for a new generation. What’s the problem.
This solves everything.
From Roberto Saviano’s Gomorrah
was assigned a room of sorts. More of a cubby-hole, just big enough for a bed and a wardrobe. There was no talk of monthly rent, utility bills, or a phone hook-up. He introduced me to four guys, my housemates, and that was that. They explained that this was the only apartment in the building that was still occupied and that it served as lodging for Xian, the Chinese man in charge of “the palazzi,” the buildings. There was no rent to pay, but I was expected to work in the apartment-warehouses on the weekends. I’d gone looking for a room and ended up with a job. In the morning we’d knock down walls, and in the evening we’d clean up the wreckage—chunks of cement and brick—collecting the rubble in ordinary trash bags. Knocking down a wall makes unexpected sounds, not of stones being struck but of crystal being swept off a table onto the floor. Every apartment became a storehouse devoid of walls. I still can’t figure out how the building where I worked remained standing. More than once we knowingly took out main walls. But the space was needed for the merchandise, and there’s no contest between saving walls and storing products.
The idea of cramming apartments full of boxes dawned on some Chinese merchants after the Naples Port Authority presented its security plan to a delegation of U.S. congressmen. The plan provides for the port to be divided into four areas: cruise ships, pleasure craft, commercial vessels, and containers, with an evaluation of the risks in each area. After the security plan was published, many Chinese businessmen decided that the way to keep the police from feeling they had to intervene, the newspapers from writing about it constantly, or TV crews from sneaking around in search of a juicy story was to engulf everything in total silence. A rise in costs was another reason for making the merchandise more inconspicuous. Having it disappear into rented warehouses in remote parts of the countryside, amid landfill and tobacco fields, would have meant a lot of additional tractor-trailer traffic. This way, no more than ten vans, stuffed to the gills with boxes, go in and out of the port daily. Just a short trip and they’re in the garages of the apartment houses facing the port. In and out, that’s all it takes.
Nonexistent, imperceptible movements lost in the everyday traffic. Apartments rented. Gutted. Garage walls removed to make one continuous space. Cellars packed to the ceiling with merchandise. Not one owner dared complain. Xian had paid them all: rent and compensation for unauthorized demolition. Thousands of boxes brought up in the elevator, which was rebuilt to move freight. A steel cage with tracks and a continuously moving platform. The work was concentrated in a few hours, and the choice of merchandise was not accidental. I happened to be unloading during the first days of July. The pay is good, but it’s hard work if you aren’t used to it. It was hot and humid, but no one dared ask about air-conditioning. No one. And not out of fear of punishment or because of cultural norms of obedience and submission. The people unloading came from every corner of the globe: Ghana, Ivory Coast, China, and Albania, as well as Naples, Calabria, and Lucania. No one asked because everyone understood that since merchandise doesn’t suffer from the heat, there was no reason to waste money on air-conditioning.
We stacked boxes of jackets, raincoats, Windbreakers, cotton sweaters, and umbrellas. It seemed a strange choice in the height of summer to be stocking up on fall clothing instead of bathing suits, sundresses, and flip-flops. Unlike the warehouses for stockpiling merchandise, these storage apartments were for items that would be put on the market right away. But the Chinese businessmen had forecast a cloudy August. I’ve never forgotten John Maynard Keynes’s lesson on the concept of marginal value: how, for example, the price of a bottle of water varies depending on whether it is in the desert or near a waterfall. That summer Italian enterprises were offering bottles by the falls while Chinese entrepreneurs were building fountains in the desert.
Five of you text way too much and can not comprehend complexities or what is blatantly stated in that section. I know you can never read.
Not my loos now is it?
Let me get this straight.
Someone seeking to profit off you asks if you want a new house built.
You say sure.
Then they ask if you have money to start the grift, as if new buildings do not use the cheapest materials unless you are rich,
You say let me check with the bank.
Someone asks you again if you will buy into the grift.
You say no I work three jobs and live in my car plus just got tagged for back unpaid student loans and now my credit score dropped and my insurance went up and those damn cvt transmissions suck and mine needs replaced but the car is out of warranty.
But I still want that new house.
Now there is surprise on lack of building permits.
Who could have imagined.
From metro detroit I am seeing a lot of price reductions and a decrease in quality listings. Homes that are newer and or updated will sell as long as reasonably priced. Overall prices are lower but not by much and still not that affordable.
Doesn’t Detroit already have homes for s dollar? And bad water.
Detroit suburbs offer beautiful homes for $850K, sometimes even less. That is very affordable. People there are lucky.
The income to house payment ratio is at an all time high. Homes are historically unaffordable for the average worker. This is not lucky.
Another factor to consider:
It’s too hard for folks to fathom. Banks don’t lend deposits. Deposits are the result of lending/investing. Loans = deposits always. If there is an increase in interest bearing deposits, there is a decrease in non-interest-bearing deposits. It’s a fundamental equation.
So, there is a big problem. The lending capacity of the system is based upon the circulation of deposits, not the volume of deposits. That makes all bank-held savings frozen, lost to both consumption and investment. That is the error in the Keynesian economics. That’s how you get stagflation, increasing savings deposits offset by increasing Reserve Bank credit.
Bank-held savings have a zero payments velocity.
The gov borrowed $36T. The gov spent it on consumption and investment. The money is gone. Prof Spencer: what’s the problem
You mean transfer payments to nonproductive recipients? Dead weight military hardware? 600 dollar hammers?
If the monies represented by the deficits are spent on projects which increase productivity & reduce waste, the deficits are beneficial no matter how financed). The initial inflationary effects of commercial bank financing are quickly overcome by the larger output & lower unit costs. Debt incurred which reduces unit costs of production & promotes the health & welfare of the population obviously is “good” debt.
In 2008 the money was spent to keep the banks alive. Thereafter to keep RE alive. Thereafter, in 2020, the money was spent to keep people alive. Thereafter on infrastructure and factory. Thereafter banks and foreign entities will finance onshore co. They will hire people, who were saved in 2020, and payback the gov. Prof Spencer: what’s the problem.
People purchased Iphones and autos they could not afford too look cool.
Dumbassery always starts with a look in the mirror.
The money is not gone. There are still $36T in bonds owned by investors, getting paid ever-increasing amounts of interest as they roll over at higher rates. That’s a lot of paper wealth floating around.
The cash, that the government spent by borrowing $36T (gradually, then suddenly?), is now sloshing around in the banking system. It did not get destroyed and it did not vanish.
Some of it is idling and some of it being used for daily transactions.
Low-interest cash is the ultimate hot potato. A lot of people don’t want to hold it so they’ve bid up the prices of bitcoin and stocks trying to get rid of it.
And yes, it’s low interest. For all the people that matter in terms of income and wealth inequality, after-tax interest rates are well below the rate of inflation. Holding cash is currently toxic to their wealth.
That’s the same error as Dr. Philip George explains in “The Riddle of Money Finally Solved”.
Prices are rising, employment is falling – but not spectacularly. Housing affordability sucks. It’s to be expected. The economy is being run in reverse. The proper economic policy is to lower policy rates while draining reserves (draining money).
The 1966 Interest Rate Adjustment Act is prima facie evidence.
Monetary Flows { M*Vt }: 1966 Interest Rate Adjustment Act
It is cerebral indeed. In short, the bankers pay for the deposits that they already own. It is the proper policy, as a group, not for an individual bank.
To the bankers accustomed to thinking of banking in terms of their own individual bank operations this may seem unreal-perhaps theoretical. Their everyday experiences have demonstrated beyond any reasonable doubt that a bank’s lending capacity is increased when funds flow into the bank. These funds, they know, build up the bank’s balances with correspondents and , insofar as the funds are not required by law as a reserve against the incremental deposit inflow, they can be used to buy securities or make loans.
In other words, the individual banker thinks of his banking operation as being of an intermediary nature. He sees his bank as standing between savers and borrowers, transmitting to worthy borrowers the savings of the bank’s customers. There is nothing in the individual banker’s experience to dispel the illusion that he is operating an intermediary type of financial institution. And it is for this reason that bankers and their associations have been, and are, such vigorous proponents of time deposit banking.
Viewed from the vantage point of the entire commercial banking system an entirely different perspective is obtained. It then becomes evident that the commercial banks are not intermediaries, they are not credit transmitters rather are the commercial banks credit creators. That is to say, the commercial banks create new money when making loans to, or buying securities from, the nonbank public.
This can be demonstrated by examining the differences in the consolidated condition statements for banks and the monetary system for any two points in time.
It will be noted that the increase in loans and investments (all earning assets) of the banks during the interval are approximately equal to the increase in the demand and time deposit liabilities of the banks (excluding inter-bank demand deposits). That these two net increase figures are so nearly identical is no happenstance, for demand deposits largely come into being through the credit creating process, and time deposits owe their origin almost exclusively to demand deposits, either directly through transfer from demand deposits or indirectly via the currency route.
There are many factors which can, and do, alter the volume of bank deposits, including: changes in currency held by the nonbank public, in bank capital accounts, and in Reserve bank credit, etc.
Although these items are large taken together, they nevertheless have been peripheral in altering the aggregate total of bank deposits. Thus, the expansion of Reserve bank credit during any period is offset by the increase in currency holdings of the nonbank public. Since the nonbank public is taking more out of the banks than they deposit in the banks, it follows that the funds which financed the net increase in earning assts were generated within and not outside the banking system. Taking into account the principal “outside” factors of the monetary system, outside sources of funds for this period of unprecedented expansion of the commercial banking system are offsetting.
That is to say, the capacity f the commercial banking system to lend, and the aggregate size of the system, given ample opportunities to make bankable loans and acquire eligible securities, are determined by monetary policy.
“According to the National Association of Housebuilders, immigrants make up one in four workers in the construction industry.”
“These immigrants, aside from contributing hundreds of billions of dollars in taxes, fill critical jobs in cornerstone industries. Reduced immigrant labor in agriculture, construction, and logistics raises costs across the supply chain, driving up food, housing, and consumer prices for every American.”
Selected Quotes from Construction warning issued after foreign-born population plummets
Disclaimer: numbers may be bullshit as immigrant participation in surveys has been put on ICE.
Not H1B immigrants they are trucking and bad coding.
So the article is admitting that illegal immigrants are much less than 1/4 of the construction workforce, because total immigrants are about 1/4 and illegals are a small subset.
Other data indicate the illegal population (which peaked at maybe 16 million) is around 1/3 of the legal immigrants (47 million). The article claims 1/10 of the illegals have left the country already.
This would put the illegal-immigrant portion of the construction workforce at around 7%. Enough that they could go away and not break the economy, especially during the unfolding construction bust.
Meanwhile, over half the legal immigrants have gone on to become U.S. citizens.
“Disclaimer: numbers may be bullshit as immigrant participation in surveys has been put on ICE.”
Numbers are also slanted by the view one wants to take.
Most numbers are very slanted.
In Related News:
The Reverse Repo facility is down to a measly $22.3B. Yikes!
Some sort of Fed announcement relating to rate suppression should be imminent.
New privately owned housing units completions, total: 1,415K, well above Jan 2011 @520K and May 2020 @1,174K, but below Aug 2024 @1,715K. Nixon 1973 peak was 2,300K units when LBJ projects were completed. Real wages also peaked in 1973. Q2 2020, was a spike to ignore.
Well 2 telling signs are that First Time homebuyers “Age has increased to 38 from 35” and First Time Buyers market share has “Decreased to an Historic Low of just 24%”… Cant sell when virtually nobody is actually looking to buy.
Add on the fact that a record 26% of home buyers are paying cash for their purchases, and there is obviously a problem. 76% are not buying for the first time, and 26% that are buying, are paying cash.
Not exactly what one would be looking for if a housing boom was what you needed and were looking for…
As Wolf noted a couple weeks ago, the average age of first time buyers hasn’t changed since 2012 and is down slightly from the year 2000.
https://wolfstreet.com/2025/08/11/average-age-of-first-time-home-buyers-and-how-it-changed-over-the-past-25-years/
Also note that in the 2nd chart that share of home purchases by first time buyers is increasing, not decreasing. That’s important because those are the people who are soaking up new inventory of homes.
So whatever problems there are, it’s not related to first time buyers.
Speaking of permits, the permits to rebuild after the wildfires in LA is basically at a standstill. It’s becoming more and more apparent that rich developers in conjunction with city officials are hoping to wait out homeowners hoping to rebuild so that they can swoop in and buy the properties on the cheap and erect condos/apartment buildings etc.
So much for Governor Nutjob speeding up the process for those affected by the wildfires.
THANK YOU FOR YOUR ATTENTION TO THIS MATTER
How is Lahaina (sp) doing?
And wasn’t 100 million stolen b y that donation group to aid those who got burnt out?
BBBBBBBUUUUUUUTTTTTTTT, homeowners and renters with insurance MMMMAAAAYYYY get reimbursed.
Everyone else is HOMELESS!
Tent permits are way down too.
You can get 100k for a well maintained refrigerator box.
Christopher Knight was only 20 years old when he walked away from society, not to be seen again for more than a quarter of a century. He had been working for less than a year installing home and vehicle alarm systems near Boston, Massachusetts, when abruptly, without giving notice to his boss, he quit his job. He never even returned his tools. He cashed his final pay cheque and left town.
Knight did not tell anyone where he was going. “I had no one to tell,” he says. “I didn’t have any friends. I had no interest in my co-workers.” He drove down the east coast of America, eating fast food and staying in cheap motels – “the cheapest I could find”. He travelled for days, alone, until he found himself deep into Florida, sticking mostly to major roads, watching the world go by.
Eventually, he turned around and headed north. He listened to the radio. Ronald Reagan was president; the Chernobyl nuclear disaster had just occurred. Driving through Georgia and the Carolinas and Virginia, blessed with invincibility of youth, buzzed by “the pleasure of driving”, he sensed an idea growing into a realisation, then solidifying into resolve.
All his life, he had been comfortable being alone. Interacting with others was so often frustrating. Every meeting with another person seemed like a collision.
He drove north to Maine, where he had grown up. There aren’t many roads in the centre of the state, and he chose the one that went right by his family’s house. “I think it was just to have one last look around, to say goodbye,” he said. He didn’t stop. The last time he saw his family home was through the windscreen of his car.
He kept going, “up and up and up”. Soon he reached the shore of Moosehead Lake, the largest in Maine, and the point where the state begins to get truly remote. “I drove until I was nearly out of gas. I took a small road. Then a small road off that small road. Then a trail off that.” He went as far into the wilderness as his vehicle could take him.
Knight parked the car and tossed the keys on the centre console. He had a tent and a backpack but no compass, no map. Without knowing where he was going, with no particular place in mind, he stepped into the trees and walked away.
And from Nevada
Richard Roman lives by few rules. But one he made up himself: When you’re in hell, move a few ZIP codes away and make your own heaven.
His heaven is a simple life at a surprisingly cozy encampment in an abandoned mine shaft above Boulder City, just 26 miles southeast of the glitzy and glamorous city that wore him out.
Roman, a tall 68-year-old with boyish blonde hair, intense dark blue eyes and a weathered face that recalls a younger Hugh Hefner, freely acknowledges that his struggles with drugs and alcohol played a big role in his descent into homelessness.
“I’ve always liked the nefarious kind of life,” he said with a rueful grin.
Plus even the FAMOUS get hit RIP LOIS LANE.
One Superman star suffered with severe mental health issues while soaring to Hollywood stardom.
Margot Kidder was best known for her role in the 1978 Superman movie alongside actor Christopher Reeve and starred in four of the Superman franchise’s films. She quickly became a well-known actress, however she suffered from “mind flights” due to bipolar disorder.
Things took a turn for the worst back in the 1990s when Margot was left homeless in California, later placed in psychiatric care. She was also reportedly seen searching through rubbish for food and without many of her teeth.
Lumber mills usually have a summer increase in sales but this year mill production has been low to keep prices from crashing. Tariffs have not impacted lumber.
Trump is increasing lumber tariffs which will add to the cost of new construction
If min wage was not so high there is a lot of demolition for salvage materials out there. Real wood floors and classic vintage home niceties.
I spoke with one guy who lives in his wife’s grandfathers home. He has a radiator with a built in warming oven for bread.
I see many homes that are falling apart here and know the value of the materials, hundred year old beams for example or hundred year old fixtures.
But not worth the effort to hire and pay a crew to salvage any of it.
I only understand this because in 1983 I worked demolition for salvage on an old factory for min wage. Every thing was saved and I can still pull nails from a 2×4 faster than anyone I know, both sides.
Summer to winter, tough job but one you remember.
Why would permits be down during a tariff-driven golden age economy?
City workers justifying their jobs by deliberately slowing the process while claiming to be over worked in order to either get OT pay or get their cousin hired into the permitting office.
That’s because they’ve been infiltrated by the Lizard People.
Dude, only the upper class are Lizards. Lizards never go to small or medium size towns.
I understand India is like this. I wonder how much of this type of thing occurs in the USA?
Read Roberto Saviano’s Gamorrah. The parts about the Camorra building practices and simply expand the scope.
What ever happened to rammed earth houses?
Too many houses build, or permitted to be built already. All signs point to a “Buyers Market” and in that scenario, housing Permits go bye-bye until Hard Proof” that houses are moving again.
All signs point to future shanty towns.
Duh, those encampments have just now started being destroyed. Give it a week at least.
Very grim tidings for Southern boom towns when you factor in tariffs threatening to strangle manufacturing in those areas.
What Towns specifically? Why are tariffs specifically strangling manufacturing in those Specific Towns that You Will List?
Mexico and Venezuela?