The Census Bureau’s New Residential Construction report came out yesterday. Let’s take a detailed look.
Please consider the Census Department New Residential Construction Report for June 2023.
Building Permits
- Privately‐owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,440,000.
- This is 3.7 percent below the revised May rate of 1,496,000 and is 15.3 percent below the June 2022 rate of 1,701,000.
- Single‐family authorizations in June were at a rate of 922,000; this is 2.2 percent above the revised May figure of 902,000.
- Authorizations of units in buildings with five units or more were at a rate of 467,000 in June.
Housing Starts
- Privately‐owned housing starts in June were at a seasonally adjusted annual rate of 1,434,000. This is 8.0 percent (±10.3 percent) below the revised May estimate of 1,559,000 and is 8.1 percent (±9.2 percent) below the June 2022 rate of 1,561,000.
- Single‐family housing starts in June were at a rate of 935,000; this is 7.0 percent (±11.7 percent) below the revised May figure of 1,005,000.
- The June rate for units in buildings with five units or more was 482,000.
Housing Completions
- Privately‐owned housing completions in June were at a seasonally adjusted annual rate of 1,468,000. This is 3.3 percent (±9.7 percent) below the revised May estimate of 1,518,000, but is 5.5 percent (±11.0 percent) above the June 2022 rate of 1,392,000.
- Single‐family housing completions in June were at a rate of 986,000; this is 2.8 percent (±10.2 percent) below the revised May rate of 1,014,000.
- The June rate for units in buildings with five units or more was 476,000.
Please note the margins of error in these reports. It’s been revision, after revision, after revision, mostly negative.
Housing Starts Single Family vs Multi-Family
Housing Starts 1959-Present
To put the rebound from 2010 in perspective, housing starts are about where they were in 1959.
That’s the strong cyclical nature of new home construction.
Another Heavily Revised Housing Starts Joke of a Report for May 2023
On June 20, I commented Another Heavily Revised Housing Starts Joke of a Report for May 2023
Last month I stated “History suggests the April rise will be revised away in May.”
Sure enough. The Commerce Department revised housing starts in April from 1,401,000 to 1,340,000. That’s a negative revision of 4.4 percent. The big jump in April is now a reported decline. So take the huge jump this month with with a heavy dose of skepticism.
Repeat Performance
There was a big jump in May from significant negative revisions in April. And now we see huge negative revisions to May.
The Census Bureau revised May from 1.631 million to 1.559 million. That’s a negative revision of 4.4 percent, matching the negative revision of 4.4 percent in April.
Gee, who couldda thunk that?
There was still a big bounce in May, assuming no more negative revisions.
These residential construction reports are a joke.
I think you are correct calling these reports and their revisions a joke, but I believe it is a much bigger problem as this and a plethora of other government reporting is outright wrong and undercutting their credibility. For instance, basically overnight the covid vax was determined to be safe but covid treatments with long tested safe and cheap drugs that worked would require years of testing to determine efficacy and safety. On its face this does not pass the smell test but media pushed it without question and silenced anyone that countered the party line. The compliant press fortified previous reasons not to trust them. For a good article on this and more malfeasance have a squint at:
link to articles.mercola.com
That is just a really crazy thing to say, or uneducated…potato poTATo. MRNA vaccine technology had been worked upon around the globe for decades and was very near approval anyway, it just happened that this particular SARS virus Corona 2019 came along at the right time to have it applied to the technology.
As to the “other” “…covid treatments with long tested safe and cheap drugs that worked would require years of testing to determine efficacy and safety. ”
Name a single one. And no horse paste does not count. Just because a drug is safe and effective for something else does not make it safe and effective for Covid. And it is dumbshit blow hard assholes that crowed such things during the pandemic that got so many people sick and dead, thanks a lot, most of them were supporters of the fat assed orange spy anyway so better off without them!
Oh whatever you do don’t wear a mask even if it is the mark of an antisocial idiot because rights y’all know!!!! Christ on a fucking crutch people that dumb really should not wear protection in a deadly pandemic because Darwin and all that!
Mish: You suddenly started appearing in my inbox after several years of absence, glad to see you. It is not just housing reports, it is all data now. I trust none of it. At least none from the government or any private industry data that os reported in dollars rather than units of production. Anyone who lived through Covid between 2019 and today knows that inflation was not 5.9% in 2021 as reported, nor was it 8.7% as reported for last year, and being on a fixed income I have a damned good idea how much it really was at least here in Florida. In the period fall of 2019 when inflation was reported for the 2018-19 year (I do not include 2020 much because the data was so skewed by things like negative $40 per bbl of oil it renders the entire data set unusable, so I usually go from 2019 which is when the inflation and supply chain problems began thanks to the absurd easy to win trade war with China) my cost of living has risen at bare minimum net up 30%. In that period I have had COLAs on my veterans disability of 15.9%. I mean that real price increases for the items I must pay for as a single head of household homeowner in Florida were up at least 45% for a net of thirty after COLA increases.
And inflation they assure us soothingly is not totally dead but now under control. Again NOT IN FLORIDA! Just today I noticed the tolls on the parkway went from $1.06 to $1.16 per tolling booth (electronic now) equals 9.4% and that is not under control. Or, Governor DeSantis allowing his regulators in Tallahassee to grant a Duke Energy rate increase request for electricity in February of 22.2%. Power here was already more than double what I paid for electric in Oregon. The utility claimed there was so much damage (contained to Lee County) that they need this increase, a permanent increase to be paid by the whole state, even though they had reinsurance for a lot of the damages and the government paid out billions for infrastructure repairs. This increase will mean about $80 per month for both summers and winters, about 8 to 9 months per year.
My homeowner insurance was $1,532 in the 2020/2021 year (April through March) and for this year it is $2,489 for an increase of 62.5% and I was just notified that it would go up by the new maximum annual amount of 14.1% next year for a bill of $2,840 which I cannot pay. I am taking my old RE agent out to a nice lunch Saturday in order to talk about listing my house. The plan at this point is to just go homeless for a while because at $3,632 per month for a 100% disabled vet a roof is just no longer an option. Funny how we used to think of housing as a necessity and now a disposable option.
By god the wealthy are doing great though aren’t they?
I hear a lot of people are moving from Florida to Georgia due to inflation in Florida. Better than homeless. Maybe your agent will have some thoughts. Good luck to you man and thanks for the service.
Thank you Shamrockva but if people are leaving FL for GA they are just going to infect that place with inflation as well. And there are still 1,500 people per day arriving net of out migration.
dead on correct. mish has totally missed inflation raging past few years. units. and cumulative too. many intelligent men get stuck on position like recession or deflation or whatever and cannot re calibrate. units of currency destroyed for daily life. raging inflation is just beginning imho. i hope i’m incorrect but the electronic cursor conjuring of zeroes requires only a finger on a computer. not even ink or paper…………..insanity.
You need to move to a cheaper state. Florida gets hit with strong hurricanes. Always has and always will. I don’t blame insurers for jacking rates. Either that or own a home outright, hurricane proof it, and skip insurance. That’s the only way I would live there.
People have been well aware of the fact that Florida gets hit with hurricanes since the Spanish founded St. Augustine in 1565. Insurance was not expensive till just a few years ago. I owned a house in Tallahassee I bought in 1999, the insurance was $365 per year = $1 per day. All these years insurance was profitable till just the last four years or so? But not now? Sorry, that does not wash. What does is insurers know that the state is now solidly red run by republicans who are fine with captured regulators and who will give the industry (any industry that is not “woke”) absolutely anything they want, like Duke Energy getting a 22.2% rate increase even though the price of nat gas has fallen to record lows adjusted for inflation, and given that they have a solid profitability that has marched steadily higher every year, including 2022 in which they made $18.6 billion in net profits.
So, you’re saying all the home insurers gathered together and decided unilaterally to charge a lot more because now they can with republicans in charge? Weren’t the same people in charge before Ian?
And why would insurers be leaving the state now that they’re allowed to charge a lot more?
Geeez whatever gave you that idea? Maybe the fact that is what I said?????
Nevertheless, home builders are knocking it out of the park. D.R. Horton, KB Home, Beezer Homes, and Lennar, all growing earnings and stock valuations very significantly.
I watched an interview Wealthion held with Nick Gerli on the topic of real estate. He observed new homes don’t have constraints that existing homes have. A builder isn’t going to hold onto a home because of an existing low rate mortgage. Builders can buy down interest rate points, but sellers of existing homes won’t. Builders have been offering upgrades or price cuts, but sellers of existing homes won’t budge. Now that housing starts are drifting lower, it’s because demand is also drifting lower. There could be a huge price drop as those needing to sell accept the best asking price.
You got that right, in 2020 I bought a house in the greater Tampa region for $257k at 2.25% interest zero down (VA) with a P&I of just $945 per month. Nothing is going to get me off that mortgage with one exception, homeowner insurance has gone from $1,532 to next years $2,800 and just the overall inflation with a shitty 8.7% COLA to me veteran disability means I just can’t afford a roof over my head, none that I will “settle” for anyway. Since mid 2019 the actual cost of living has gone up so much that the then decent if nothing special comp has now become a disaster. My P&I may be very affordable but my house payment goes up every year as if I had and adjustable rate loan. So, early next year I plan to sell and use the profits to supplement rent in another country, or simply go homeless, what ever I can afford.
Thanks America, you will reap what you sow.
Housing is a regional situation. In my area 2008 had no impact. Property around here continues to sell as it always did rain or shine. It’s the best given investment this side of the Mason Dixon. Buy a house, vacant property in the area and sit on it. It will appreciated 6-8% like clockwork over and over…meh. I just bought a vacant lot. Already had two neighbors ask about buying it. No. Ask me in 5 years though and I will entertain it for the right price. I don’t even mess with 401K’s anymore. Worthless garbage. Took it all out and buy property. In your face Blackrock and Vanguard. Go sucker someone else into your woke agenda.
New privately owned under construction 5+ units : 977K, and all time high, but slowing down.
Rents in about 85% of US markets could fall 20% and still be obscenely profitable.
From Moody’s latest weekly publication, released today:
The NAHB Housing Market Index inched up 1 point to 56 in
July, which is the highest since mid-2022 and represents the
third month in a row that the index has been at or above
50—the threshold marking good building conditions. The
six-month change in the NAHB index tends to track the
two-quarter percent change in real residential investment.
Excluding the sharp rebound in builder confidence after the
pandemic recession, the current six-month change in the
index is close to a record high.
Stronger single-family permitting this year matters for U.S.
growth prospects, as residential investment in single-family
structures accounts for a larger share of GDP than
multifamily structures. Also, single-family investment has
historically contributed more to volatility in GDP growth.
Besides the hard data on permitting, the resounding
improvement in homebuilder confidence makes the case for
residential investment to turn supportive of growth sooner
rather than later.
Residential investment subtracted 0.2-percentage point
from annualized real GDP growth in the first quarter of this
year after lopping off 1.4 and 1.2 percentage points from
annualized growth in the third and fourth quarters of last
year, respectively. By itself, the NAHB Housing Market Index
implies that residential investment could make its first
positive contribution to GDP growth since the first quarter
of 2021 as soon as the second or third quarter of this year.
Mish, my wife owns a design/build company in Richmond, Virginia. I know this is a very regional business and it would be nice to hear from builders/remodelers from around the country that follow you. We were hoping to pick up some tradesmen( fine carpenters, plumbers, etc when the builders slowed down but we are just not seeing available talent in the marketplace which leads me to believe there is plenty of work to go around. She does high end remodels and additions so has not been impacted. She has a 2 year backlog. On a side note we hear of slow downs from local suppliers to the trades but even when we are in a (wholesale)shop there seems to be plenty of traffic. Thanks.
Florida is absolutely ON FIRE with building. I live in a Tampa region exurb and almost every trip down to the VA hospital (couple times per year) I almost do not recognize the places I drive through. Exit after exit I see the likes of five story apartment complexes that cover square miles. Mile after mile of gas stations, fast food, big box places, new hospitals and schools, whole city’s worth of subdivision going up, fulfilment centers of a million or more square feet, I am telling you that it will be not very long till Orlando/Tampa grow into one mega city. The Villages (UGH!) is the fastest growing census area in the country. They say 1,500 people per day are moving in to the state net of people leaving, I think it might be higher.
Just another proof point that the facts don’t matter, it’s who counts and presents the data that matters. Just like the voting system.