According to the latest data from the Department of Commerce, housing starts grew 3.2 percent in November 2018 from the downwardly-revised October level.
On the other hand, starts were down 3.6 percent annually, hitting a seasonally-adjusted annual 1.256 million rate. Housing permits grew 5 percent from the upwardly-revised October figure, with a 1.328 million annual pace. MarketWatch reports that more builders started construction than was originally anticipated for November, and applied for more permits. The pace of single-family starts was down 4.6 percent month-over-month.
The housing sector is stuck in neutral, and the question now is whether it can regain some momentum in the new year. In October, home builders were sitting on the most inventory in over seven years, so it’s somewhat surprising that they picked up the pace of building in November. And industry sentiment has fallen to a three and a half year low.
“The relatively strong permits numbers suggest that homebuilders think the fall in sales will prove temporary, probably because much of it has been triggered by the two hurricanes and the wildfires, while mortgage demand has strengthened,” said Pantheon Macro’s Ian Shepherdson.