Housing Continues to Weaken: Starts Decline 5.3%, Permits Down 0.6%

Starts, permits, and completions are down across the board as home buying continues to weaken.

The Census Bureau New Residential Construction report for September shows housing continues to weaken.

Housing Starts

Privately‐owned housing starts in September were at a seasonally adjusted annual rate of 1,201,000. This is 5.3 percent below the revised August estimate of 1,268,000, but is 3.7 percent above the September 2017 rate of 1,158,000. Single‐family housing starts in September were at a rate of 871,000; this is 0.9 percent below the revised August figure of 879,000. The September rate for units in buildings with five units or more was 324,000.

Building Permits

Privately‐owned housing units authorized by building permits in September were at a seasonally adjusted annual rate of 1,241,000. This is 0.6 percent below the revised August rate of 1,249,000 and is 1.0 percent below the September 2017 rate of 1,254,000. Single‐family authorizations in September were at a rate of 851,000; this is 2.9 percent above the revised August figure of 827,000. Authorizations of units in buildings with five units or more were at a rate of 351,000 in September.

Housing Completions

Privately‐owned housing completions in September were at a seasonally adjusted annual rate of 1,162,000. This is 4.1 percent below the revised August estimate of 1,212,000, but is 7.0 percent above the September 2017 rate of 1,086,000. Single‐family housing completions in September were at a rate of 844,000; this is 8.7 percent below the revised August rate of 924,000. The September rate for units in buildings with five units or more was 312,000.

Year-Over-Year Mirage

Those year-over-year improvements are a mirage. September was a very easy comparison.

Year-over-year comparisons in November and January through May of 2019 will look miserable.

Mike "Mish" Shedlock

Comments (5)
No. 1-5
DFWRealEstate
DFWRealEstate

You know demand is soft when new home builders have resorted to selling directly to Wall Street slumlords. I was digging through some local sales data, and what I uncovered here in North Texas made my head spin...

Mike Mish Shedlock
Mike Mish Shedlock

Editor

Thanks DFW

VKL
VKL

A builder is building five small no yard homes on 5000 sq ft lots in Stockton, CA, 1150 to 1500 Sq ft cracker boxes. He sold the 1500 sq ft house next to us, the nicest one for $343,000 . The builder wanted $400, 000. The one on the corner sold, but fell through. Probably interest rate increases, he sold the smaller house for $329,000 before it fell through! No one is interested in the one right behind the shopping center! He is rushing to complete the next two best of the five. I might buy one when the bottom really falls out with my son. What made me laugh is that he stated that is selling them himself no realtor and he will not drop the price below 329,000 ! HA! I will keep you all posted!

oudaveguy98
oudaveguy98

Absolutely fascinating, informative analysis here on this market; always appreciate these articles Mish!

dulevot
dulevot

They rechristened their business as a hamburger stand. The first time a McDonald’s franchise used the Golden Arches logo was in 1953 at a location in Phoenix, Arizona.