- Homebuyers should be pleased today’s new construction numbers, as both permits and completions were up in February. This means a healthy dose of new homes will be in the market this spring in an otherwise inventory-constrained market.
- While the short run looks good for the housing pipeline, we should pay attention to the fact that permits were down in February. Permits are important because they are the earliest signals of new supply in the next 6-12 months, so any sign they are falling is something to take note of.
Both housing starts and completions in were up in February, growing by 3% and 5.4% year-over-year, respectively. That said, neither of these numbers are statistically significant. We can’t be sure whether the actual number of starts and completions in February was up, down, or flat. However, there is a long way to go before starts and completions are back to normal, with starts 63.8% and completions 56.4% of the 50-year average.
While the short run looks good for the housing pipeline, we should also pay attention to the fact that permits were down in February. Permits fell 6.2% month-over-month. While one month does not make a trend, any downward movement should be of concern since monthly permit figures tend to be statistically significant. Despite the downward blip, permits are the healthiest of these three indicators as they are no 69% back to normal.
