Jump in Building Permits Hints at Uptick in New Home Sales

The U.S. Census Bureau and the Department of Housing and Urban Developmentrnhave released New Residential Construction statistics for March 2011.</p<pHousing Starts data estimates how much new residential real estate constructionrnoccurred in the previous month. New construction means digging has begun.rnAdding rooms or renovating old ones does not count, the builder must bernconstructing a new home (can be on old foundation if re-building). Although thernreport offers up single family housing, 2-4 unit housing, and 5-unit and abovernhousing data, single family housing is by far the most important as it accountsrnfor 70-80% of total home building (which should be shifting more towardrnmulti-family in the years ahead).<br /<br /Building Permits data provides an estimate on the number of homes planning onrnbeing built. This indicator basically tracks how much future constructionrnactivity we should expect to take place in the future. This data is a part ofrnConference Board's Index of Leading Economic Indicators.</p

Here is quick recap from Reuters….</p

RTRS- US MARCH HOUSING STARTS +7.2 PCTrnVS FEB -18.5 PCT (PREV -22.5 PCT) </p

RTRS- US MARCH HOUSING STARTS 549,000rnUNIT RATE (CONSENSUS 520,000) VS FEB 512,000 (PREV 479,000) </p

RTRS- US MARCH HOUSING PERMITS +11.2rnPCT VS FEB -5.2 PCT </p

RTRS- US MARCH HOUSING PERMITS 594,000rnUNIT RATE (CONSENSUS 540,000) VS FEB 534,000 </p

RTRS- US MARCH SINGLE-FAMILY STARTSrn+7.7 PCT TO 422,000 UNIT RATE; MULTIFAMILY +5.8 PCT TO 127,000 UNIT RATE </p

RTRS- US MARCH HOUSING PERMITS 5 UNITSrnOR MORE AT 173,000, HIGHEST SINCE JAN 2009</p

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<br /Excerpts from the Release…</p

BUILDING PERMITS</p

Privately-ownedrnhousing units authorized by building permits in March were at a seasonallyrnadjusted annual rate of 594,000. This is 11.2 percent (±2.6%) above the revisedrnFebruary rate of 534,000, but is 13.3 percent (±1.3%) below the March 2010rnestimate of 685,000.</p

Single-family authorizations inrnMarch were at a rate of 405,000; this is 5.7 percent (±1.1%) above the revisedrnFebruary figure of 383,000. Authorizations of units in buildings with fivernunits or more were at a rate of 173,000 in March.</p

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HOUSING STARTS</p

Privately-owned housing starts in March werernat a seasonally adjusted annual rate of 549,000. This is 7.2 percent (±18.0%)*rnabove the revised February estimate of 512,000, but is 13.4 percent (±9.1%)rnbelow the March 2010 rate of 634,000.</p

Single-family housing starts in March were atrna rate of 422,000; this is 7.7 percent (±15.0%)* above the revised Februaryrnfigure of 392,000. The March rate for units in buildings with five units orrnmore was 117,000.</p

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HOUSING COMPLETIONS</p

Privately-ownedrnhousing completions in March were at a seasonally adjusted annual rate ofrn509,000. This is 14.2 percent (±13.9%) below the revised February estimate ofrn593,000 and is 20.8 percent (±9.6%) below the March 2010 rate of 643,000.</p

Single-family housing completionsrnin March were at a rate of 374,000; this is 22.2 percent (±9.4%) below thernrevised February rate of 481,000. The March rate for units in buildings withrnfive units or more was 130,000.</p

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We are able make a forward looking observation about New Home Sales to come because the New Home Sales survey is primarily based on a samplern of houses selected from Building Permits data.  Building Permits were up 11.2% in March, so New Home Sales should make some positive progress in March as well….from a record low of course. READ MORE

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