Last Update: 19-Nov-14 08:55 ET
- Housing starts declined 2.8% in October from an upwardly revised 1.038 mln (from 1.017 mln) in September to 1.009 mln. The Briefing.com consensus pegged housing starts at 1.025 mln for October.
- Since June, housing starts have followed a sawtooth pattern. The decline in October continued that trend.
- Even though the number of housing starts failed to meet expectations, we would not classify the report as disappointing.
- Single-family construction, which generally follows stable trends, increased 4.2% to 696,000 in October from 668,000 in September. That was the most single-family home starts since 710,000 were started in November 2013.
- The increase in the November reading of the NAHB homebuilder sentiment indicator 58 from 54 in October suggests single-family starts should continue to rise next month.
- Multifamily starts declined 15.4% from 370,000 in September to 313,000 in October. Large swings in multifamily construction are not unusual and we would expect the pendulum to swing back in November.
- The number of homes currently under construction increased 1.4% to 802,000. That is the most homes currently under construction since December 2008 and will put upside pressure on fourth quarter GDP growth.
- A surge in the typically stable single-family construction sector bodes well for overall growth in the construction sector.