After the dismal homebuilder sentiment data earlier in the week, it is no surprise that analysts expected a drop in both housing starts and building permits for November (the latest data) and they were right. While Housing Starts fell 0.5% MoM (better than the 1.8% drop expected) – as incentives dominated inventory liquidation, forward-looking building permits collapsed 11.2% MoM (vs -2.1% exp). That is the biggest MoM drop since the peak of the COVID lockdowns…
Source: Bloomberg
This leaves the total number of housing starts (SAAR) at the lowest since June 2020 for permits…
Source: Bloomberg
Under the hood, this is the 9th straight month of single-family housing unit permits declines. But more notably multi-family permits plunged. On the Starts side, signle-family dropped for 8th month of the 9 while multi-family starts managed a small rise MoM…
Source: Bloomberg
Finally, circling back to the start of this note, we suspect building permits (forward-looking) face significantly more pressure as homebuilder expectations for future sales is at decade lows…
Source: Bloomberg
Is that really what Jay Powell wants?
Tyler Durden
Tue, 12/20/2022 – 08:37
