Housing Starts Rise 12.3%
Housing starts rose 12.3% in August to a seasonally adjusted annual rate of 1.36 million units from an upwardly revised reading in July. Single-family starts increased 4.4% to 919,000 units but were still down 2.7% year over year. Multifamily starts jumped 32.8% to 445,000 units Regional starts were mixed. Combined single-family and multifamily starts rose 4.4% in the South. Starts declined 1.8% in the Northeast, 5.6% in the Midwest and 11.3% in the West.
Building Permits Rise 7.7%
Building permits rose 7.7% in August to 1.42 million annual units after rising to 1.34 million annual units in July. Single-family permits increased 4.5% to 866,000 units and multifamily permits rose 13.3% to 553,000 units. Regional permits were mixed. Year to date, permits were up 5.7% in the Northeast and 1.6% in the South. Permits fell 6.9% in the Midwest and 5.6% in the West.
New-Home Sales Rise 7.1%
New-home sales rose 7.1% in August to a seasonally adjusted annual rate of 713,000 units and sales for July were revised upwards. New home sales were up 6.4% from August 2018. The inventory of new homes for sale fell to 326,000 homes in August, a 5.5-months’ supply at the current sales pace, down from a 6.4-months’ supply in July. The median sales price rose to $328,400 in August after rising to $312,800 in July. The median sales price in August 2018 was $321,400. Regional new home sales year to date were mixed. Sales were up 11.7% in the South and 7.8% in the West. Sales were down 16.5% in the Northeast and 10.5% in the Midwest. Sales of new homes are tabulated when contracts are signed and are considered a more timely barometer of the housing market than purchases of previously-owned homes, which are calculated when a contract closes.
Existing Home Sales Rise 1.3%
Existing home sales rose 1.3% in August to a seasonally adjusted annual rate of 5.49 million homes after rising to an upwardly revised reading in July. Sales were up 2.6% from August 2018. Regional sales were mixed. Sales were up 7.6% in the Northeast, 3.1% in the Midwest and 0.9% in the South. Sales dropped 3.4% in the West. Total housing inventory rose at the end of August to 1.86 million after falling to 1.8 million in July and was down 2.6% from August 2018. Unsold inventory is at 4.1-month supply at the current sale pace, up from a
4-month supply in July and down 2.6% from July 2018. The median existing home price for all housing types in July was $280,800, up 4.7% from August 2018. August was the 90th consecutive month that home prices increased.
Builder Confidence Rises to 68
Builder confidence rose one point to 68 in September from a downwardly revised reading in August, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Builder confidence has held in the mid-to upper 60s since May. September’s reading was the highest level since last October. Solid household formation and attractive mortgage rates are contributing to builders’ positive attitudes, but they are still grappling with ongoing supply-side challenges, including a shortage of labor and lots. The HMI indices were mixed in September. The index measuring current sales conditions rose two points to 75, the component gauging expectations in the next six months fell one point to 70 and the index measuring buyer traffic held steady at 50. Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 59, the West rose two points to 75 and the South moved up one point to 70. The Midwest was unchanged at 57.
Mortgage Rates Steady at 3.64%
A 30-year fixed-rate mortgage (FRM) was 3.64% at the end of September, up very slightly from 3.58% at the end of August. Rates were 4.72% at the end of September 2018. Freddie Mac expects rates to average 4.5% this year and 4.8% next year. Low mortgage rates have caused a corresponding increase in applications for mortgages and refinancing.
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