Housing Starts: What we know

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Housing Starts: What we know

By Andy Carlo - 01/17/2019
With the partial shutdown of the federal government now in its fourth week, and setting a new record, new residential construction starts have not been published since Dec. 18.

That’s when the report for November 2018 was published. The December report was scheduled for Jan. 17 but the U.S. Census Bureau remains on hiatus due to a lack of federal funding.

The shutdown also prevented the publishing of the Dec. 27, 2018 report spotlighting new residential sales for last November.

On Jan. 16, in conjunction with releasing the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI) featuring the latest builder confidence level, the NAHB provided estimates for single-family starts.

The NAHB said that December Census data would show that single-family starts ended the year totaling 876,000 units, marking a 3% gain over the 2017 total of 848,900.

In its latest monthly Housing Health Report for December 2018, BuildFax – the Austin, Texas-based property research firm tracking residential and commercial properties – said new single-family housing authorizations decreased 3.76% year-over-year.

This is the second consecutive month that housing authorizations have declined, according to BuildFax.

The report also says that single-family housing authorizations decreased by 0.95% month over month for December.

And there was more tough news from BuildFax.

Looking ahead to the greater economic picture, a BuildFax simulation projected the likelihood of a recession will almost double between 2019 and early 2020 – reaching a 43% probability of an economic recession.

The projection is based on single-family housing authorizations continuing to plateau with an annualized growth rate of just 2%.

“Under current conditions, we anticipate single-family housing authorizations to be a must-watch indicator in 2019 and as we move into 2020. However, more than a few critical economic factors must align before a recession is imminent,” said Jonathan Kanarek, chief operating officer of BuildFax.