Building Permits Surge To 13 Year Highs Thanks To Warm Weather In Northeast

After December's surge in starts and tumble in permits, analysts expected a reversion in both in January's data and that is what happened with a huge 9.2% MoM spike in building permits (the most since June 2017) and housing starts dropped 3.6% MoM (though notably less than the 11.2% drop expected)...

Source: Bloomberg

The spike in permits was driven by 34.6% surge in Northeast, but increases were seen in every region (Midwest +8.2%; South +8.0%, West +3.1%).

This sent Building Permits to the highest level SAAR since March 2007...

Source: Bloomberg

Both single- and multi-family permits jumped...

Additionally, there was a 77.6% Y/Y increase in multifamily starts and just 4.6% Y/Y increase in 1-unit housing...

By region, new-home construction fell in the South and Midwest. Starts increased in the Northeast to the highest since June 2015 and climbed in the West the best level since the end of 2006.

Clearly, mild weather played a role in both the December and January readings as warmer temperatures supported construction in months that typically slow homebuilding in areas like the Northeast.