“October housing permits and starts fall below estimates, signaling bearish construction trends as builders face high mortgage rates and cautious demand.”, — write: www.fxempire.com
The single-family segment posted a sharp monthly decline of 6.9%, with starts falling to 970,000, signaling reduced builder activity amid high financing costs. Multi-family starts stood at 326,000, further illustrating sluggishness in larger-unit projects.
Housing Completions Outperform Year-Over-Year October’s housing completions reached 1.614 million, coming in strong with a 16.8% increase year-over-year from 1.382 million in October 2023. However, completions were down 4.4% from September’s revised figure of 1.688 million, reflecting a gradual cooling in project finalizations.
Single-family completions remained steady at 986,000, a slight 1.4% dip from September. Multi-family completions, at 615,000, continued to show resilience compared to historical averages, supporting broader housing market supply.
Market Forecast The October data presents a mixed picture. Both building permits and housing starts missed estimates, signaling reduced near-term construction activity. However, strong year-over-year gains in completions suggest that previously delayed projects are reaching the market, partially offsetting the impact of declining starts.
The short-term outlook for residential construction remains bearish. Elevated mortgage rates, coupled with declining permits and starts, point to headwinds for construction-related equities and commodities like lumber. Builders may further slow activity to avoid oversupply risks in a high-cost environment.