Housing Starts Fall While Permits Rise

Apr 19, 2017, 01:52
Housing Starts Fall While Permits Rise

USA homebuilding fell in March as the construction of single-family homes in the Midwest recorded its biggest decline in three years, likely reflecting bad weather.

Housing starts fell 6.8 percent last month to a seasonally adjusted annual rate of 1.22 million, the Commerce Department said Tuesday.

"Housing construction permits climbed by 3.6 percent from February to March, a significant change and confirmation of an upward trend-17 percent since March of 2016", says Joseph Kirchner, senior economist at realtor.comĀ®. Groundbreakings on new homes are 8.1 percent higher through the first three months of this year compared with 2016. "Homebuyers should rest assured that new home building will continue to relieve their supply constraint in the long-run".

Privately owned housing starts decreased in March to a seasonally adjusted rate of 1.22 million. The March rate for units in buildings with five units or more was 385,000. Single-family housing starts have risen 5.9 percent.

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The drop in housing starts had a margin of error of 12.5 percentage points, and the increase in permits had a margin of error of 2.8 percentage points, according to the Journal. "Since this one-time event reduced the number of construction projects in the pipeline, we hope this will translate into more starts in the coming months".

"Today's numbers are aligned with our builder confidence metric, which contracted slightly this month but is on solid footing overall", said Granger MacDonald, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Kerrville, Texas. Readings above 50 indicate more builders view sales conditions as favorable rather than poor.

There were 266,000 new homes for sale last month, up almost 10 percent from a year earlier.

Forecast was for 1.25 million rate; February's figure was revised from 1.29 million.