The Housing Starts and Building Permits Report for November wasn't as strong as the headline figures suggested, as it featured little to no growth in both permits and starts for single-family units.
Total starts increased 3.2% to a seasonally adjusted annual rate of 1.256 million units (Briefing.com consensus 1.230 million), yet starts for single-family units declined 4.6% to 824,000, which is the lowest since May 2017.
Total permits increased 5.0% to a seasonally adjusted annual rate of 1.328 million (Briefing.com consensus 1.270 million), yet permits for single-family units were up just 0.1% to 848,000.
Permits for single-units were down 16.1% in the Northeast, down 1.7% in the Midwest, up 3.0% in the South, and down 0.5% in the West.
Single-unit starts were down 9.5% in the Northeast, down 3.2% in the Midwest, up 6.8% in the South, and down 24.4% in the West.
The number of units under construction at the end of the period stood at a seasonally adjusted annual rate of 1.148 million. That left the fourth quarter average 1.7% above the third quarter average, which will compute as a positive input for Q4 GDP forecasts.The key takeaway from the report is that it substantiates the weakening levels of homebuilder confidence and is a reflection of the impact rising interest rates are having on single-family construction activity.