U.S. January Housing Starts and Permits - Stable underlying picture but with downside risk
January housing starts have seen a steep 9.8% decline to 1366k but the outcome is only modestly below expectations and may be weather-related. Permits are virtually unchanged, up by 0.1% to 1483k, suggesting a stable underlying picture, but there may be downside risks going forward.
Single starts fall by 9.4% after a 6.2% December rise while multiple starts fell by 13.5% after a 51.8% December rise, and December’s strength made January vulnerable to a correction. Starts fell in all regions except the West. Most regions were dealing with cold in January, but for the West the main issue was fires in Los Angeles, which may have had a mixed impact on activity.
Single permits were unchanged while multiples rose by 0.2%, and changes in each of the four regions were quite modest. This suggests a healthy underlying picture but fading expectations for Fed easing may restrain data going forward. January’s NAHB Homebuilders’’ survey showed resilience, but February’s was significantly weaker.
