Privately-owned housing starts in the U.S. declined by 8.5% to an annualized pace of 890,000 units in January, missing market expectations for a reading of 920,000 going into the report. Softening the blow, however, was a sizable upward revision to the previous month’s already lofty 954,000 annualized starts, with the pace of home building in December now registering an annualized pace of 973,000 units.
The moderation in the pace of the new home construction in January reflected a pullback in multiple-unit construction (down 24.1% to 277,000) that largely reversed the previous month’s upwardly revised surge to a four-and-a-half-year high (up to 365,000 from the previously reported 338,000). In contrast, single-unit starts edged higher (+0.8%), with the 613,000 annualized starts representing highest level since July 2008. On a regional basis, weakness was concentrated in the Midwest (-50.0%) and the Northeast (-35.3%) with each region seeing sizable declines in multiple-unit starts.
What's more, the number of building permits issued increased in January, rising 1.8% to 925,000 annualized units, the highest level since June 2008. The increase reflected a 1.9% rise in permits for single-unit homes (to 584,000) while permits for multiple-unit residences rose by a slightly smaller 1.5% in the month (to 341,000). These both represent the highest levels since the summer of 2008.
