The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for April new residential building permits. The latest reading of 1.416M came in below Investing.com's forecast of 1.437M and is a 1.5% decrease from March’s revised figure of 1.437M. Building permits are down 21.1% compared to one year ago.
Here is the opening of this morning's monthly report:
Privately‐owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1,416,000. This is 1.5 percent below the revised March rate of 1,437,000 and is 21.1 percent below the April 2022 rate of 1,795,000. Single‐family authorizations in April were at a rate of 855,000; this is 3.1 percent above the revised March figure of 829,000. Authorizations of units in buildings with five units or more were at a rate of 502,000 in April. [link to report]
Here is the complete historical series, which dates from 1960. Because of the extreme volatility of the monthly data points, a six-month moving average has been included.
The Population-adjusted reality
Here is the data with a simple population adjustment. The Census Bureau's mid-month population estimates show substantial growth in the US population since 1960. Here is a chart of housing starts as a percent of the population. We've added a linear regression through the monthly data to highlight the trend.
A footnote on volatility
The extreme volatility of this monthly indicator is the rationale for paying more attention to its six-month moving average than to its noisy monthly change. Over the complete data series, the absolute MoM average percent change was 4.4%. The MoM range minimum was -24.0% and the maximum was 33.9%..
For visual confirmation of the volatility, here is a snapshot of the monthly percent change since 1960.
ETFs associated with home builders include: Invesco Dynamic Building & Construction ETF (PKB), iShares U.S. Home Construction ETF (ITB) and SPDR S&P Homebuilders ETF (XHB).
ETFs associated with residential real estate include: iShares Residential and Multisector Real Estate ETF (REZ).
For additional perspectives on residential real estate, here is the complete list of our monthly updates:
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