Slight Decline In Housing Construction: The Negative Actual Economic Impact Has Not Yet Begun
Housing permits (gold) increased slightly in January from their December lows, while the more volatile housing starts (blue) declined again. The much less volatile single-family permits (red, right scale) also declined again to a new post-pandemic low:
(Click on image to enlarge)
This is a very important long leading indicator, and shows that coming misery in the economy due to housing sector is nowhere near bottoming out.
But, as I wrote on Monday, the most important metric in the entire economy right now is probably housing units under construction, which is the “real” economic impact of the industry. Here there was a very slight (less than 1%) decline from a revised peak in October:
(Click on image to enlarge)
The bottom line is that the actual *economic* downturn in housing has not begun yet.
More By This Author:
Measured By Actual Rather Than Fictitious Prices, Inflation Is Decelerating Substantially Towards The Fed TargetThe #1 Likely Reason The Economy Has Not Gone Into Recession Yet
Updating Some Important Coincident Indicators
Disclaimer: This blog contains opinions and observations. It is not professional advice in any way, shape or form and should not be construed that way. In other words, buyer beware.
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