By Jill Mislinski
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts. The latest reading of 1.186M was above the Investing.com forecast of 1.169M and an increase from the previous month’s revised 1.011M.
Here is the opening of this morning’s monthly report, including a note on revisions:
Statement Regarding COVID‐19 Impact: Due to recent events surrounding COVID‐19, many governments and businesses are operating on a limited capacity or have ceased operations completely. The Census Bureau has monitored response and data quality and determined estimates in this release meet publication standards.
Housing Starts
Privately-owned housing starts in June were at a seasonally adjusted annual rate of 1,186,000. This is 17.3 percent (±11.0 percent) above the revised May estimate of 1,011,000, but is 4.0 percent (±9.1 percent)* below the June 2019 rate of 1,235,000. Single-family housing starts in June were at a rate of 831,000; this is 17.2 percent (±10.0 percent) above the revised May figure of 709,000. The June rate for units in buildings with five units or more was 350,000. [link to report]
Here is the historical series for total privately-owned housing starts, which dates from 1959. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.
The Population-Adjusted Reality
Here is the data with a simple population adjustment. The Census Bureau’s mid-month population estimates show substantial growth in the US population since 1959. Here is a chart of housing starts as a percent of the population. We’ve added a linear regression through the monthly data to highlight the trend.
A Footnote on Volatility
The extreme volatility of this monthly indicator is the rationale for paying more attention to its 6-month moving average than to its noisy monthly change. Over the complete data series, the absolute MoM average percent change is 6.3%. The MoM range minimum is -26.4% and the maximum is 29.3%.
For visual confirmation of the volatility, here is a snapshot of the monthly percent change since 1990.
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.
