U.S. December Housing Starts and Permits - Single family series see modest gains
December housing starts are much stronger than expected with a 15.8% rise to 1499k, unusually outperforming permits which fell 0.7% to 1483k. For the single-family sector, the contrast is much less stark, with starts up by 3.3% and permits up by 1.6%, suggesting a modestly positive trend.
Single family starts and single-family permits are both the highest since February suggesting some pick up in trend has been seen since the start of Fed easing.
Fading expectations of easing and gains in UST yields pose some threat to the 2025 outlook, though January’s NAHB homebuilders’ index suggests no sharp near-term weakening is imminent.
Multiples saw starts surge by 61.5% after a 30.7% November decline which looks like catch up with permits with multiple starts at 449k still below multiple permits at 491k despite the latter falling by 5.0% after a 15.4% November increase.
Starts increased in three out of the four regions, the exception being a marginal decline in the West. Permits showed little change anywhere, with two regions seeing modest gains and two seeing modest losses. For both starts and permits, the Northeast leads on a yr/yr basis, followed by the Midwest, then the South, with the West the weakest region.
Starts did underperform in the South in October when hurricanes hit so recent gains look supported by a post-hurricane rebound, but not dramatically.
