Unexpected Disaster

The Commerce Department New Residential Construction report for May 2024 was an unexpected disaster.

The Bloomberg Econoday consensus was for a 1 percent rise in starts and a 0.7 percent rise in permits. Instead, starts fell 5.5 percent on top of negative revisions. Excluding revisions, starts fell 6.1 percent. Permits dropped 3.8 percent.

Why this was unexpected is a mystery other than economists seem to be the most optimistic people on the planet except for politicians speaking about themselves.

Housing Report Details

Building Permits: Privately?owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 1,386,000. This is 3.8 percent below the revised April rate of 1,440,000 and is 9.5 percent below the May 2023 rate of 1,532,000. Single?family authorizations in May were at a rate of 949,000; this is 2.9 percent below the revised April figure of 977,000. Authorizations of units in buildings with five units or more were at a rate of 382,000 in May.

Housing Starts: Privately?owned housing starts in May were at a seasonally adjusted annual rate of 1,277,000. This is 5.5 percent (±9.4 percent) below the revised April estimate of 1,352,000 and is 19.3 percent (±10.0 percent) below the May 2023 rate of 1,583,000. Single?family housing starts in May were at a rate of 982,000; this is 5.2 percent (±9.9 percent) below the revised April figure of 1,036,000. The May rate for units in buildings with five units or more was 278,000.

Housing Completions: Privately?owned housing completions in May were at a seasonally adjusted annual rate of 1,514,000. This is 8.4 percent (±9.8 percent) below the revised April estimate of 1,652,000, but is 1.0 percent (±10.6 percent) above the May 2023 rate of 1,499,000. Single?family housing completions in May were at a rate of 1,027,000; this is 8.5 percent (±10.1 percent) below the revised April rate of 1,122,000. The May rate for units in buildings with five units or more was 479,000.