With homebuilder sentiment hovering near COVID lockdown lows (at 13-year lows), it is perhaps not surprising that this morning's Housing Starts and Building Permits data is such a shitshow.

• US Housing Starts tumbled 8.5% MoM (worse than the 4.4% MoM decline expected)
• US Building Permits plunged 3.7% MoM (worse than the 0.6% MoM rise expected)

That is the 5th straight month of MoM declines for the more forward-looking permits print.
 

The MoM declines dragged the SAARs down to post-COVID-lockdown lows...
 

Across the US, housing starts in the South, the nation’s biggest homebuilding region, fell 21% to the lowest in nearly a year.

Starts also fell in the Midwest, but they rose in the West and Northeast.

Starts & Permits plunged across the board (for both single-family and multi-family units)
 

Housing starts:

• Single-family 890K SAAR, down 7.0% from 957K in July and the lowest since July 2024
• Multi-family 403K SAAR, down 11% from 453K in July and the lowest since May

Housing permits:

• Single-family 856K SAAR, down 2.2% from 875K in July and the lowest since March 2023
• Multi-family 403K SAAR, down 6.7% from 432K in July and the lowest since May 2024

However, on the bright side, mortgage rates have been tumbling (near three year lows)...
 

...and mortgage applications soared almost 30% week-over-week.
 

Will the rate-cuts expected today (and for the rest of the year) provide the affordability lift that so many hope for?
 

Bear in mind there is still a vast gap between the current mortgage rates and the effective average rates of homeowners across the nation...
 

Last month, the number of single-family homes under construction extended its multi-year decline, falling to an annual pace of 611,000, the lowest since early 2021.

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