Housing Starts are good for the overall health of the U.S. economy because they create a “ripple effect” in other sectors.
What is the Housing Starts report? A “start” in construction is when excavation of a building’s foundation begins. This report measures the number of residential units on which construction begins each month.
What’s happened recently? Although September Housing Starts fell 9 percent from August to the lowest level in 18 months, single-family starts, which account for the largest share of residential housing, surged 8.1 percent. Multifamily dwellings, on the other hand, fell significantly. Building Permits, a sign of future construction, beat expectations rising 6.3 percent from August.
What’s the bottom line? New construction can lead to a rebound in jobs related to housing, which is good news for the labor market, retail sales and the economy in general. This can also translate to happier homebuyers who’ve been frustrated by a shortage in housing that has caused rents and home prices to increase throughout the country in recent years.
I’ll continue to monitor economic reports closely, but if you have any immediate questions, please call or email today.