Economic Snapshot: Record-breaking housing starts after harsh winter

Oregon Husky

Remember those concerning housing starts numbers in February and March? Those appear to be a result of seasonal blues that are now behind us, as we are seeing huge month-to-month and year-over-year growth in housing starts for April.

Housing starts

Privately-owned housing starts in April were at a seasonally adjusted annual rate of 1.135 million. This is 20.2 percent above the revised March estimate of 944,000 and 9.2 percent above the April 2014 rate of 1,039 million. Housing starts are now at the highest level since 2007.

Single-family housing starts in April were at a rate of 733,000, 16.7 percent above the revised March figure of 628,000 and at the highest level since January 2008.

Privately-owned housing completions in April were at a seasonally adjusted annual rate of 986,000. This is 20.4 percent above the revised March estimate of 819,000 and 19.4 percent above the April 2014 rate of 826,000.

Single-family housing completions in April were at a rate of 688,000, 14.5 percent above the revised March rate of 601,000.

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Even after weak housing starts in February and March, total housing starts are running 5.5 percent ahead of 2014 through April.

Housing Market Index

Builder confidence decreased two points to 54 this month and increased nine points from 45 in May 2014.

The component charting sales expectations in the next six months rose one point to 64. The index measuring buyer traffic dropped one point to 39 and the component gauging current sales conditions declined two points to 59.

Builder confidence in the South and Midwest both rose one point to 57 and 55, respectively, while the Northwest fell one point to 41 and the West dropped three points to 55.

Any number above 50 indicates that more builders view sales conditions as good than poor.

Existing home sales

Total existing home sales declined 3.3 percent from an upwardly-revised 5.21 million in March to a seasonally adjusted annual rate of 5.04 million in April. Sales have increased YOY for seven consecutive months and are 6.1 percent above the previous year.

Total housing inventory at the end of April increased 10.0 percent to 21.1 milion existing homes available for sale, 0.9 percent below April 2014. Unsold inventory is at a supply of 5.3 months at the current sales pace, up from 4.6 months in March.

The median pricing for all housing types in April was $219,400, 8.9 percent above the previous year. This marks the 38th consecutive month of YOY price gains and is the largest gain since January 2014 (10.1 percent).

The percent of first-time homebuyers remained at 30 percent in April for the second consecutive month. First-time homebuyers represented 29 percent of all buyers in April 2014.

Distressed sales ­– short sales and foreclosures – represented 10 percent of sales in April, unchanged from March and below the 15 percent of sales in April 2014.

 

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