111716-estimatesAlthough Thursday’s Jobless Claims report was pretty impressive, the report on Housing Starts and Building Permits put it to shame.  October’s reading on Housing Starts came in at a SAAR reading of 1.323 million versus consensus expectations of 1.156 million.  That difference of 167K was the biggest beat relative to expectations since January 2006!  While Building Permits weren’t quite as strong relative to expectations, in any other month a beat of 36K would have been impressive.


The table below breaks down this month’s report by type of unit and region.  For Housing Starts, the m/m and y/y gains were flat out ridiculous.  The 25.5% m/m gain was the fourth largest increase of all time, and the biggest since 1982.  Looking at the details of the report, though, most of the strength was in multi-family units which increased 69%.  Keep in mind, however, that these gains in multi-family units come on top of a pretty dismal showing for the category in September.  Building Permits were a lot more subdued in October’s report.  Overall, Permits increased just 0.3% m/m, with all the strength coming from single-family units, which increased 2.7%, while multi-family units declined 3.3%. The key point to remember when looking at multi vs single family units is that single family are generally considered to be more impactful from an economic perspective.


While much of the strength in this month’s Housing Starts may have been due to a strong showing in multi-family units, we would note that for both single-family starts and permits, October’s reading represented a new high for the cycle.




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