There were just two widely watched housing reports released last week: the February report on New Residential Construction, from the Census bureau, and the Existing Home Sales Report for February from the National Association of Realtors (NAR)….the week also saw the release of the Regional and State Employment and Unemployment Report for February from the Bureau of Labor Statistics, a report which breaks down the two employment surveys from the monthly national jobs report by state and region (Note: you might recall that January’s state and regional report was released last week; it had been delayed in order to compile the annual revisions, and this February report puts the report back on its normal release schedule)….while the text of this report provides a useful summary of the state and regional data, the serious statistical aggregation can be found in the tables linked at the end of the report, where one can find the civilian labor force data and the change in payrolls by industry for each of the 50 states, the District of Columbia, Puerto Rico, and the Virgin Islands…
This week also saw the release of another regional Fed manufacturing survey for March: the Philadelphia Fed Manufacturing Survey, covering most of Pennsylvania, southern New Jersey, and Delaware, reported its broadest diffusion index of manufacturing conditions ticked down to +3.2 in March from +5.6 in February, just the fifth positive index reading since May 2022, indicating that a small plurality of that region’s manufacturing firms are seeing increased activity again this month…
Housing Starts and Building Permits Reported Higher in February
The February report on New Residential Construction (pdf) from the Census Bureau estimated that new housing units were being started at a seasonally adjusted annual rate of 1,521,000 in February, which was 10.7 percent (±14.2 percent)* above the revised January estimated annual rate of 1,374,000 starts, and was 5.9 percent (±10.0 percent)* above the rate that housing units were being started in February of 2023…the asterisks indicate that the Census does not have sufficient data to determine whether housing starts actually rose or fell during the month, or even from those of a year ago, with the figures in parenthesis the most likely range of the change indicated; in other words, February’s housing starts could have been down by 3.5% or up by as much as 24.9% from those of January, with revisions of a greater magnitude in either direction still possible…in this report, the annual rate for January housing starts was revised from the 1,331,000 reported last month to 1,374,000, while December starts, which were first reported at a 1,460,000 annual rate, were revised from last month’s initial revised figure of 1,562,000 annually up to a 1,566,000 annual rate with this report….
The annual rates of housing starts reported here were extrapolated from a survey of a small percentage of US building permit offices visited by canvassing Census field agents, which estimated that 108,100 housing units were started in February, up from the 97,400 units that were started in January but down from the 108,900 units that were started in December….of those housing units started in February, an estimated 79,200 were single family homes and 27,800 were units in structures with more than 5 units, up from the revised 69,700 single family starts in January. and up from the 26,500 units started in structures with more than 5 units in January…(NB: those figures don’t add up because there were 1100 housing units started in structures with 2 to 4 units in February, down from 1200 in January, a figure usually small enough that it is typically ignored..
The monthly data on new building permits, with a smaller margin of error, are probably a better monthly indicator of new housing construction trends than the volatile and often revised housing starts data….for February, Census estimated new building permits for housing units were being issued at a seasonally adjusted annual rate of 1,518,000, which was 1.9 percent above the revised January rate of 1,489,000 permits, and was 2.4 percent above the rate of building permit issuance in February a year earlier…
Again, these annualized estimates for new permits reported here were extrapolated from the unadjusted estimates collected monthly by canvassing census agents, which showed permits for roughly 118,300 housing units were issued in February, up from the revised estimate of 114,800 new permits issued in January….of those permits issued in February, 79,300 were permits for single family homes and 35,100 were permits for units in structures of more than 5 units, up from the 75,900 single family permits in January, but down from January’s 35,100 permits for units in structures of more than 5 units…
For graphs and commentary on this report, see the following posts by Bill McBride at Calculated Risk: Housing Starts increased to 1.521 Million Annual Rate in February and Single Family Starts Up 35% Year-over-year in February; Multi-Family Starts Down Sharply, which in turn links to his real estate newsletter post with the same title…
Existing Home Sales Rose 9.5% in February; Prices 5.7% Higher than a Year Ago
The National Association of Realtors (NAR) reported that existing home sales increased by 9.5% from January to February on a seasonally adjusted basis, the largest jump in a year, projecting that 4.38 million existing homes would sell over an entire year if the February home sales pace were extrapolated over that year, a pace that was still 3.3% below the annual sales rate projected for February of last year….the January home sales pace was unrevised from the 4.00 million annual sales rate reported a month ago with this report….the NAR also reported that the median sales price for all existing-home types was $384,500 in February, which was 5.7% higher than in February a year earlier, and which they report is “the eighth consecutive month of year-over-year price gains.“, even though it’s the first month over month price increase in those eight months…..the NAR press release, which is titled “Existing-Home Sales Vaulted 9.5% in February, Largest Monthly Increase in a Year“, is in easy to read plain English, so if you’re interested in further details on housing inventories, cash sales, distressed sales, first time home buyers, etc., you can easily find them in that press release…as sales of existing properties do not add to our national output, neither these home sales nor the prices for which these homes sell are included in GDP, except insofar as real estate, local government and banking services are rendered during the selling process…
Since this report is entirely seasonally adjusted and at a not very informative annual rate, we usually look at the raw data overview (pdf) to see what actually happened with home sales during the month…this unadjusted data indicates that roughly 271,000 homes sold in February, up 15.8% from the revised 234,000 homes that sold in January, and 0.7% more than the 269,000 homes that sold in February of last year….that same pdf indicates that the median home selling price for all housing types rose by 1.6%, from a revised $378,600 in January to $384,500 in February, and that it was up 5.7% from $363,600 in February of last year, while it was down 6.2% from $410,100 in June of 2023, with prices falling in the Northeast in February, while increasing modestly elsewhere….for both seasonally adjusted and unadjusted graphs and additional commentary on this report, see the following two posts from Bill McBride at Calculated Risk: NAR: Existing-Home Sales Increased to 4.38 million in February and NAR: Existing-Home Sales Increased to 4.38 million SAAR in February; Median Prices Down 7.1 From Peak (NSA), which links to his in depth newsletter article with more details on this report..
(the above is the synopsis that accompanied my regular sunday morning news links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most of which are picked from the aforementioned GGO posts, contact me…)
r.j.'s space 