Renter Nation Rout - Multi-Family Home Permits Plunged Again In April As Rates Rose

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by Tyler Durden
Wednesday, May 17, 2023 - 12:39 PM

Following March's plunge in building permits (and drop in starts), analysts expected a mixed picture for April with starts lower again but permits unchanged. The reality was different with housing starts jumping 2.2% MoM (-1.4% MoM exp but March's data was revised down massively from -0.8% to -4.5%) and permits fell 1.5% MoM (vs unch exp) but also a major revision (upward from -8.8% to -3.0%)...

Source: Bloomberg

Given the massive revisions, this data seems utterly useless, but this leaves the total levels for starts and permits back at pre-COVID levels (despite rates being massively higher)...

Source: Bloomberg

The unexpected drop in permits was triggered by a second straight monthly plunge in multi-family units, down 9.7% MoM (single-family unit permits grew 3.1% MoM)

Source: Bloomberg

On the starts side, single-family dominated...

  • Single-family starts 846K SAAR, up 1.3% from 833K, and the highest since Dec 22

  • Multi-family starts 542K SAAR, up 5.2% from 515K and in a narrow range over the past year

But on the permits side it was much more mixed...

  • April Single-family permits 855K SAAR, up 3.1% from 829K, and the highest since Sept 22

  • April Multi-family permits 502K SAAR, down 9.7% from 556K and the lowest since May 21

The re-rise in mortgage rates certainly doesn't bode well for the next step in housing permits or builds...

Source: Bloomberg

We suspect The Fed wants more 'pain' for the housing market than we have seen so far.

Finally, if you still believe in miracles, spot the odd one out below...

Source: Bloomberg

Do you still trust BLS jobs data?