Housing Starts Rebound From December, Still Down Annually

8 March 2019

Housing Starts Rebound From December, Still Down Annually

Inman News

Housing completions are up month-over-month and year-over-year, according to the latest data from the Census Bureau and HUD.

Privately owned housing starts increased 18.6 percent from December 2018 to January 2019, but were still 7.8 percent lower than January 2018, according to the most recent statistics from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development (HUD). Housing starts were reported at a seasonally adjusted rate of 1,230,000, of which 926,000 were single family homes.

Tendayi Kapfidze, the chief economist at LendingTree believes the overall numbers should be viewed with some skepticism, in the wake of the government shutdown.

“Housing starts jumped 18 percent month-over-month after four months of decline, but I view the number with some suspicion,” Kapfidze said. “Even within the general volatility of the housing starts series, this was a big change for one month.”

The data was delayed by the government shutdown and I suspect the shutdown may have affected the quality of the data as the standard survey process may have been disrupted,” Kapfidze added. “This is a number that should be discounted until any change in the downward trend is confirmed with two or three more months of data.”

The release from the government agencies specifically notes, at the bottom, that the government shutdown delayed data collection and processing for the report.

“While response rates were consistent with normal levels, delays in data collection could make it more difficult to determine exact start and completion dates,” the release says. “However, processing and data quality were monitored and no systematic issues were identified.”

New privately-owned housing units authorized by permits were reported at a seasonally adjusted annual rate of 1,345,000, a 1.4 percent increase over December, but down 1.5 percent year-over-year. The number of single-family homes authorized by permits dropped 2.1 percent month-over-month.

In a market where sales have slowed and inventory is still tracking on the weaker side, privately-owned housing completions are rebounding. The number of housing completions reported in January was at a rate of 1,244,000, a 27.6 percent increase from December and a 2.1 percent year-over-year increase.