US Housing Starts Plunge In July

Tyler Durden's Photo
by Tyler Durden
Wednesday, Aug 18, 2021 - 08:38 AM

Following the plunge in homebuilder sentiment (beginning to catch down to homebuyer sentiment) and the disappointment in home sales, analysts oddly expected mixed data with Starts falling but forward-looking permits rising modestly. They underestimated both...

After Housing Starts unexpectedly surged in June, July saw starts collapse, down 7.0% MoM (vs -2.6% expected). Building Permits went the other way, rising 2.6% MoM, better than the +1.0% expected (this is the first MoM rise in permits since March)...

Source: Bloomberg

Total Permits and Starts are back at pre-COVID levels...

Source: Bloomberg

The base effect from last year's brief collapse is now over and Housing Starts YoY have normalized...

Source: Bloomberg

The plunge in Starts was dominated by multi-family units:

  • single family units down 4.5%

  • multifamily units down -13.6%

And on the Permits side, the picture was entirely different with multi-family rebounding as single-family permits continue to slide...

  • Singlefamily units -1.7%

  • Multifamily units +12.2%

And so with home prices at record-er and record-er high prices, thanks in large part to Wall Street's domination of the bid, we wonder just what damage The Fed can do to this nascent bubble next?