New Residential Housing Starts Down In June

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts. The latest reading of 1.253M was below the Investing.com forecast of 1.261M and a decrease from the previous month's revised 1.265M.

Here is the opening of this morning's monthly report, including a note on revisions:

Housing Starts

With this release, unadjusted estimates of housing units authorized by building permits for January through December 2018 have
been revised. Also, seasonally adjusted estimates of housing units authorized by building permits have been revised back to 
January 2013. All revised estimates are available on our website.

Privately‐owned housing starts in June were at a seasonally adjusted annual rate of 1,253,000. This is 0.9 percent (±7.9 percent)* below the revised May estimate of 1,265,000, but is 6.2 percent (±7.8 percent)* above the June 2018 rate of 1,180,000. Single‐family housing starts in June were at a rate of 847,000; this is 3.5 percent (±9.6 percent)* above the revised May figure of 818,000. The June rate for units in buildings with five units or more was 396,000. [link to report]

Here is the historical series for total privately-owned housing starts, which dates from 1959. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.

(Click on image to enlarge)

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 1959. 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.

(Click on image to enlarge)

A Footnote on Volatility

The extreme volatility of this monthly indicator is the rationale for paying more attention to its 6-month moving average than to its noisy monthly change. Over the complete data series, the absolute MoM average percent change is 6.3%. The MoM range minimum is -26.4% and the maximum is 29.3%.

For visual confirmation of the volatility, here is a snapshot of the monthly percent change since 1990.

(Click on image to enlarge)