With surging homebuilder sentiment, we suspect the disappointing plunge in Housing Starts (-2.8% vs +0.8% exp) will surprise a few but there is hope... as Building Permits rose 4.8% (vs 0.9% expectations) on the back of an 8% surge in multi-family / rental units. This is the highest level fo Permits since June 2008 (but still over 50% below peak permits levels in 2005). The only region with any increase in starts was the South.
Permits beat but Starts miss...
Fool me once...or twice... but three times...?
The breakdown: Permits jumped entirely due to an 8% surge in rental akak multi-family units, led by the West where there was a 22% jump in permits.
On the other hand, single-family dropped even as single-family units posted a small pick up.
The one caveat: single-family units declined in all regions except the South, where starts jumped by 10%
Finally, no matter what the permits or starts data indicates, something curious is that the level of actual housing completions for single-family houses dropped 7.4% to 585K. This was the lowest monthly print in all of 2014! It appears once started, builders - super confident as they may be - are taking their good time to complete the project.