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Housing Starts Increasingly Volatile, Way Lower Than Expected in April

Economists expected another strong month in April. Instead, starts declined 9.5%.
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Housing Starts, Permits, Completions 2021-04

Housing Starts

  • Privately‐owned housing starts in April were at a seasonally adjusted annual rate of 1,569,000. This is 9.5 percent below the revised March estimate of 1,733,000, but is 67.3 percent above the April 2020 rate of 938,000. 
  • Single‐family housing starts in April were at a rate of 1,087,000; this is 13.4 percent below the revised March figure of 1,255,000. 
  • The April rate for units in buildings with five units or more was 470,000.

Building Permits

  • Privately‐owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1,760,000.
  • This is 0.3 percent above the revised March rate of 1,755,000 and is 60.9 percent above the April 2020 rate of 1,094,000. 
  • Single‐family authorizations in April were at a rate of 1,149,000; this is 3.8 percent below the revised March figure of 1,194,000. 
  •  Authorizations of units in buildings with five units or more were at a rate of 559,000 in April.

Housing Completions

  • Privately‐owned housing completions in April were at a seasonally adjusted annual rate of 1,449,000. This is 4.4 percent below the revised March estimate of 1,515,000, but is 21.7 percent above the April 2020 rate of 1,191,000. 
  • Single‐family housing completions in April were at a rate of 1,045,000; this is 0.1 percent above the revised March rate of 1,044,000. 
  • The April rate for units in buildings with five units or more was 401,000.

Bloomberg Econoday Consensus Estimates

  • Starts: 1.705 million units at a seasonally-adjusted annualized rate (SAAR) vs 1.569 million actual.
  • Permits: 1.780 million units at a seasonally-adjusted annualized rate (SAAR) vs 1.760 million actual.

Starts were a major miss.

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Revisions

The census department revised data all the way back to 2015.

I noticed this when I went to update my spreadsheet. Normally I go back a few months until the numbers match. Today that was years back.

The Census Department's New Residential Construction Report contained this notice. 

Notice of Revision: With this release, unadjusted estimates of housing units authorized by building permits for January through December 2020 have been revised. Also, seasonally adjusted estimates of housing units authorized by building permits have been revised back to January 2015, and seasonally adjusted estimates of housing units authorized but not started, started, under construction, and completed have been revised back to January 2016. 

Housing Starts 1959-Present

Housing Starts 1959-Present 2021-04

The above chart puts a much needed perspective on the housing picture.

Starts are below where they were in 1964, 1969, the early 1970s, most of 1983-1987, and the housing bubble years in the mid 2000s.

Population growth has slowed and so have attitudes towards starting a family.

Mish