Housing permits, new housing starts and completions are all trending upward from October, but housing starts and completions are still at a lower rate than a year ago, according to the latest data from the U.S. Census Bureau.
Privately-owned housing units that were authorized by building permits in November climbed to a seasonally adjusted annual rate of 1,328,000, which is 5 percent up from last month and 0.4 percent up from November of last year.
New, privately-owned housing starts in November were at a seasonally adjusted annual rate of 1,256,000, which is up 3.2 percent month-over-month, but still down 3.6 percent over November of 2017.
Private homes that were completed hit a seasonally adjusted annual rate of 1,099,000, which was only up 0.4 percent from last month and down 3.9 percent from last year. Single-family homes in particular suffered by this metric, down 5.4 percent from last month.
The numbers came in slightly above expectations, according to Scott Volling, principal at PricewaterhouseCoopers. The surprise was mostly driven by strong starts and permits in the multi-family segment.
“Today’s positive surprise comes on the heels of yesterday’s release of the homebuilder sentiment index, which dropped to 56, it’s lowest level since May 2015,” Volling said. “The drop seemingly reflects builders’ continued concern over affordability challenges driven by costs for land, labor and materials, along with mortgage rates above recent historical lows that may be keeping potential buyers on the sidelines.”
Leonard Kiefer, the deputy chief economist at Freddie Mac, noted in a thread on Twitter, that even with the bounce back, starts are still historically low.
Housing starts bounce back a bit in November, but have been sputtering most of this year. While up from the lows earlier this decade, total starts are quite low by historical standards pic.twitter.com/9CEmJnCb6Q
— Leonard Kiefer (@lenkiefer) December 18, 2018