'Stop' in Starts Amid Shutdown

January 18, 2019
Stop sign as government shutdown affects housing data release
Photo: Unsplash/Luke Van Zyl

Due to the ongoing partial government shutdown, federal data on housing starts are currently not available. In the meantime, private sector data company BuildFax is offering supplemental data.

BuildFax estimates that 1 percent fewer permits for single-family homes were "pulled" by contractors in December 2018 compared to November 2018, and that permit authorizations fell 3.8 percent annually. MarketWatch reports that this would translate to a rate of approximately 840,000 for single-family permits in the last month of 2018, the lowest reading since August 2018. "As a reminder, throughout the year, the headline numbers most analysts track from Commerce and other sources are the pace of activity, not each month’s numbers." 

The National Association of Home Builders, meanwhile, decided to estimate the full-year total for single-family starts – that is, ground-breakings – in 2018. The Washington-based lobby group projects last year’s starts came to 876,000, a 3 percent increase over 2017. Permits obviously precede starts, and many economists consider single-family permits one of the best leading indicators. But as NAHB chief economist Rob Dietz says, “it’s not always the case that a permit becomes a start. The start indicates that construction is taking place, materials are being purchased, workers are being contracted.”

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