Single-Family Housing Starts Fade In July
Sometimes, you need to look deeper than the headlines to get the news that matters. This basic truth’s latest example comes from the July Housing Starts data, as published by the U.S. Census Bureau.
According to the newspapers, Housing Starts improved last month:
- US Housing Starts Make Modest Rebound (FT)
- Housing Starts Rise Slightly (MoneyWatch)
- Housing Starts Tick Higher In July (MarketWatch)
However, these stories are speaking in terms of all housing starts — not just the single-family ones. This is a major point of difference for home buyers because the most people don’t buy the multi-unit homes and apartment buildings that’s also a part of the Housing Starts data.
The overwhelming majority of buyers buy single-family homes and in July, as in the previous 3 months, the number of single-family housing starts fell.
In fact, single-family housing starts are down by nearly 25 percent since April and are now at their lowest levels since May 2009.
This is a much different message from the headlines above.
It’s not surprising that single-family housing starts are down; builder confidence is down as well and the two metrics tend to trend in the same direction.
Furthermore, building permits for single-family homes fell in July, too.
As a home buyer, the drop in Housing Starts should help reduce housing inventory in the months ahead. This may lead home prices to rise because home values are based on supply and demand. For home sellers, falling starts should help reduce competition for buyers.
Each real estate market is unique and supply levels will vary from ZIP code to ZIP code. For up-to-the-minute inventory levels, make sure to talk with your real estate agent.
Related posts:
- Single-Family Housing Starts Hold Steady For The 8th Straight Month
- Single-Family Housing Starts Fell In January, Despite What The Headlines May Have Told You
- Good News For Homeowners : Housing Starts Tumble In July
Michael Haigh has 20+ years of professional experience in the banking and mortgage industry. He has the knowledge, education, and dedication to get you the best loan for your situation, answer your questions honestly and completely, and make your mortgaging experience a pleasure. His reputation includes being the number one lender in the country for CitiBank for 9 years, then at Chase for 1 year and now with WJ Bradley since August of 2009. This is because of the quantity of loans, myriad of people he's helped, and his dedication to helping his clients find the perfect loan for them.
