The Census Bureau today released its survey of residential construction. Total annualized housing starts came in at 893,000 units at a seasonally adjusted, annualized rate.
This rate was 9.3% below the May rate, but 7.5% above last June’s rate.
These numbers are highly volatile. If we compare quarters, we see that in the second quarter of this year, start rose by 6% compared to the first quarter, and by 13.4% compared to the same quarter last year.
The charts below show the volatility in the monthly series over different timescales.
Starts for single-family homes seem to have plateaued over the past eighteen months at a rate of around 600,000 whereas apartment building has grown over the past twelve months back to where it was 18 months ago. In 2010, apartment construction accounted for about 15% of all units, today around 30% are apartments.
These charts show the national average numbers. If we look at the regional pictures we see that all June’s decline in starts was limited to the South region: In the following chart see the “SO1” (South single-family) and “SO2+’ (South apartments) bars in June. All the other contributors (with the exception of the small Northeast decrease in single-family homes) saw an increase in starts.
If we compare starts with permits in the South region we see that the recent drop in single-family starts is not in line with the steady issuing of permits. Single-family starts usually follow within one month of their permit issuance, although larger apartment buildings can see several months.
We might thus expect a bounce back up in the rate of single-family starts in the South – either for July, or as a revision upward to June’s initial estimate. We will take a quick look at previous revisions below.
(You can find these and charts for other regions and timescales on our Residential Charts and Tables.)
Mid-West Apartment Building
We remark in passing that the time-series for apartment unit starts in the Mid-West, although seasonally-adjusted, seems to be exhibiting some seasonality in the past two or three years. There has been a rise through the year, followed by a plummet in December. Currently apartment starts are on a tear (seasonally-adjusted.)
Revisions
The May starts rate was revised up today, marginally (see next chart) and the April rate, for a second month was unchanged.
These revision average out revisions made to the different structure size series (below) which tend to cancel out. Some of this may be due to later correction of misreported structure types.
