Update on the housing market

http://mam.econoday.com/byshoweventfull.asp?fid=451343&cust=mam&year=2012&lid=0

Housing Starts

Released On 10/17/2012 8:30:00 AM For Sep, 2012 Prior Prior Revised Consensus Consensus Range Actual Starts - Level - SAAR 0.750 M 0.758 M 0.765 M 0.745 M to 0.785 M 0.872 M Permits - Level - SAAR 0.803 M 0.801 M 0.810 M 0.799 M to 0.843 M 0.894 M

Highlights The housing sector is showing somewhat stronger-than-expected health with both starts and permits gaining in the latest report. The September starts pace of 0.872 million units topped market expectations of 0.765 million and was up 34.8 percent on a year-ago basis. The latest increase was led by the multifamily component which jumped 25.1 percent, following a 3.2 percent dip in August. However, the single-family component also improved, gaining a notable 11.0 percent in September after a 7.3 percent increase the prior month. By region, starts in September were led by a 20.1 percent boost in the West Census region, followed by the South with a 19.9 percent increase. The Midwest also rose with a 6.7 percent boost. The Northeast dipped 5.1 percent. Along with the recent gains in the NAHB housing index measure, homebuilders are showing moderate optimism with permits paid for. Housing permits jumped 11.6 percent in September to an annualized pace of 0.894 million, which was up 45.1 percent on a year-ago basis. Analysts forecast 0.810 million units. On the news, equity futures rose slightly. Housing clearly is now taking the lead for the recovery as manufacturing has softened due to weakness in Europe and Asia. The Fed's Operation Twist is gradually paying off with lower mortgage rates slowly bringing demand back up. The news is good but still from a low baseline.

Market Consensus before announcement Housing starts in August advanced 2.3 percent following a 2.8 percent slip in July. The August starts pace of 0.750 million units was up 29.1 percent on a year-ago basis. For the latest month, the increase in starts was led by the single-family component which gained 5.5 percent after a 4.5 percent decline in July. Housing permits eased in August after a moderately healthy July. Permits fell back 1.0 percent after a 6.7 percent rebound in July.

Definition A housing start is registered at the start of construction of a new building intended primarily as a residential building. The start of construction is defined as the beginning of excavation of the foundation for the building.  Why Investors Care

Monthly figures are often volatile; housing starts fluctuate more than many indicators. It takes several months for total housing starts to establish a trend. Consequently, we have depicted total starts relative to a five month moving average. Data Source: Haver Analytics

http://bcshort.files.wordpress.com/2010/09/us-housing-prices.jpg

More recent graph from the website: http://scottgrannis.blogspot.com/2012/10/the-reluctant-recovery-part-4.html