US Housing Starts Beat Forecast, While Building Permits Disappoint

U.S. housing data for November came out mixed on Tuesday with Building Permits falling more than expected and Housing Starts beating expectations while matching last month’s performance.

Building Permits came in at 1.34 million units. The forecast was for an increase of 1.48 million units. In October, the government reported a 1.52 million unit gain.

Housing Starts beat the forecast with a reading of 1.43 million units. Estimates called for 1.40 million units. In October, housing starts came in at 1.43 million units.

Pre-Report Predictions

Ahead of the reports, analysts were predicting the Commerce Department’s report on housing starts would say the number of homes under construction in November fell nearly 2%, to a seasonally adjusted annual rate of 1.40 million.

That figure – the lowest since July – followed a smaller-than-expected decline of 4.2% in October as rapidly rising mortgage rates and high prices continued to dampen demand for housing.

Housing starts have tumbled 21.2% in the six months since April when they hit a near 16-year high of 1.810 million (the highest since June 2006).

Permits for future construction, a good gauge of upcoming housing activity, are anticipated to all 1.8% as well to 1.485 million in November, the lowest since August 2020 (for context, January’s print of 1.899 million was the highest since May 2006).

The reports follow Monday’s NAHB’s housing market index, which fell more than expected to the lowest since June 2012 as high mortgage rates and soaring construction costs weighed on the mood of homebuilders. Watch for existing home sales Wednesday and new home sales on Friday, both for the month of November, according to the FOX Business Team.

Market Reaction

The reaction in the financial markets was limited, likely due to the mixed results and below average holiday volume.