Housing Starts Jump 11.8% But Growth has Seesawed Wildly for a Year

Building Permits 

• Privately‐owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 1,712,000. This is 3.6 percent above the revised October rate of 1,653,000 and is 0.9 percent above the November 2020 rate of 1,696,000. 
• Single‐family authorizations in November were at a rate of 1,103,000; this is 2.7 percent above the revised October figure of 1,074,000. 
• Authorizations of units in buildings with five units or more were at a rate of 560,000 in November.

Housing Starts 

•  Housing Starts Privately‐owned housing starts in November were at a seasonally adjusted annual rate of 1,679,000. This is 11.8 percent above the revised October estimate of 1,502,000 and is 8.3 percent  above the November 2020 rate of 1,551,000. 
• Single‐family housing starts in November were at a rate of 1,173,000; this is 11.3 percent above the revised October figure of 1,054,000. 
• The November rate for units in buildings with five units or more was 491,000.  

Completions

• Privately‐owned housing completions in November were at a seasonally adjusted annual rate of 1,282,000. This is 4.1 percent above the revised October estimate of 1,231,000 and is 3.1 percent above the November 2020 rate of 1,244,000.
• Single‐family housing completions in November were at a rate of 910,000; this is 0.1 percent below the revised October rate of 911,000. 
• The November rate for units in buildings with five units or more was 364,000. 

Closer Look 

Year-Over Year Comparisons 

Housing starts are up 8.3% from a year ago but that was an easy comparison. 

If we compare starts to December of last year, they are only up 1.1%.

Essentially, starts have been in a broad meandering channel since December of last year.

The 2021 high was in March when starts hit 1.725 million on a seasonally-adjusted-annualized rate (SAAR). 

The 2021 low was a month earlier. In February starts were 1.447 million units SAAR. 

Seasonal adjustments and covid-19 variances have made for wild swings month-to-month. 

The detail chart shows a meandering path. November is closer to the top of the range than the bottom for 2021.

Bond Market Reaction

The bond market reaction to this strength was the more interesting item than the housing data itself. 

Yields are down despite the strength. More on the bond market reaction in a bit.

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