Preview: Due May 21 - U.S. April Housing Starts and Permits - A mixed picture but trend may slow in Q2
We look for April housing starts and permits to both see levels of 1.40m, for starts a fall of 6.8% after a rise of 10.8% in March, and for permits a rise of 2.7% after a fall of 11.4% in March.
Housing trends have no clear direction. The Q1 bias was marginally positive for starts and permits but we feel risk are on the downside entering Q2 with Fed easing expectations fading. A strong rise in March starts appears to be a response to a strong rise in February permits that was reversed in March.
March saw a strong 9.7% rise in single starts that significantly outpaced what has been a fairly gentle uptrend in single permits, suggesting single starts will see a significant correction lower, we expect by 7.9%. A 0.6% rise in single permits would be in line with trend.
Multiples have been volatile recently with starts seeing strong gains in January and March with a sharp fall in February, while permits saw sharp falls in January and March but a strong rise in February. Our April forecasts of a 4.3% rise for multiple starts and a 6.8% rise for multipole permits would both be smaller moves than in most recent months, neither fully reversing their March moves.
