New US Home Construction Suddenly Booms
If you're looking for evidence to support the idea that the recent easing in US financial conditions, and particularly the sharp decline in mortgage rates, is poised to rekindle inflationary animal spirits, look no further than a dramatic increase in housing starts.
While an ongoing dearth of resale inventory demands more in the way of new construction regardless, it's difficult to escape the notion that the big drop in financing costs from the October highs might've played a role in bolstering
We know that most new multi-family starts are aimed at the rental market. I wonder what proportion of the funds for this new construction carries variable rates. So for whom are all those new single-family units targeted, renters or buyers?
Looks like multifamily starts only ticked up a little; the jump is almost all single-family.
https://fred.stlouisfed.org/graph/?g=1cUUY
“You can write your own script. God knows everyone else is.“
Ha well said. Don’t think anyone has high confidence on any direction regarding housing. The juxtaposition of new starts vs sentiment is interesting, maybe timing related but maybe not. It would make sense for sentiment to be low while new starts are high if incentives are destroying their margins.