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Thursday, March 28, 2024

US Housing Starts, Permits Explode Higher In July With Builder Sentiment At Record

Courtesy of ZeroHedge View original post here.

After screaming higher in May and June (after a 3-month collapse), Housing Starts' rebound was expected to slow drastically in July (while Building Permits were expected to re-accelerate after a disappointing slowdown in June.

However, the analysts could not have been more wrong as both starts and permits exploded higher in July (up 22.6% vs +5% exp, and 18.8% vs +5.4% exp respectively)…

This is the biggest MoM rise in permits since June 2008 (that didn't end well) and biggest MoM rise in starts since Oct 2016…

Source: Bloomberg

Multi-family Permits surged from 378k SAAR to 467k and single-family permits exploded from 840k SAAR to 983k SAAR (just shy of the record 999k SAAR in Feb 2020)…

This is the biggest MoM rise in multi-family permits since March 2018..

Source: Bloomberg

And the biggest jump in single-family permits since July 1980…

Source: Bloomberg

Multi-family Starts screamed higher from 349k SAAR to its second-highest ever at 547k SAAR (and single-family starts rose from 869k SAAR to 940kl SAAR)…

Bottom line: The permits surge was much higher in single-family which makes sense with rents tumbling… but the surge in starts was led by multi-family units.

The real 'V' is soaring as fast as homebuilder sentiment…

Source: Bloomberg

But sentiment among buyers appears decoupled still from that of the builders…

Source: Bloomberg

If we build they will come… despite tightening mortgage loan standards and depression-era unemployment?

As we previously details, the loan standards for most products – such as C&I loans, residential mortgages and credit cards – were hiked so much they nearly matched the standards during the financial crisis when it was virtually impossible to get any new loans.

This was the second quarter in a row in which loan officers reported sharply tighter financial conditions.

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