Even though the number of new home starts plunged by almost 10% in December, the massive headline on Marketwatch was BEST YEAR SINCE 2007. WOW!!!! We must really be experiencing a strong market driven housing recovery.

But wait. Let’s look at a long-term chart and assess how awesome this housing recovery has been. Considering that 2009 marked the lowest level of  starts in the last 45 years, we’ve certainly recovered from that dreadful level. Of course, the current level of starts is 33% below the level during the 2001 recession and about equal to the level during the 1991 and 1981 recessions. It is also 55% below the most recent peak in 2006 and 50% below levels from the 1970’s.

Consider that the current level has been achieved during a time when mortgage rates have been the lowest in this 45 year period. Also, consider that mortgage rates are going higher. Also, consider that young first time buyers are almost non-existent due to student loan debt and no jobs.

As you can also see from the chart, the starts have been driven by the construction of apartments, not single family homes. This has been driven by Wall Street and Bernanke’s 0% interest rates. But, now apartment vacancies are on the rise. They have overbuilt and the wheel will come off this fraud too.

The only time that single family housing starts have been lower over the last 45 years was at the absolute bottom of a recession. Think about that. The housing market is currently peaking where previously it had bottomed. And the MSM has the balls to declare this fantastic news.


Starts Plunge 9.8% As Housing Permits Miss By Most In 7 Months

Tyler Durden's picture

Last month’s record-breaking surge in housing starts has rapidly reversed and fell 9.8% MoM – the biggest drop since April 2013. Despite a plethora of revisions, single unit housing starts tumbled to 610k – the lowest since July. However, permits were dismal (which is what we should be caring about if we are looking ahead at how the ‘recovery’ will play out). Building Permits dropped 3% MoM, far more than expected, missing by the largest gap since June. This was the 3rd biggest monthly drop in total starts since Lehman. However, year-over-year, the data is abysmal – Starts rose at the slowest pace since Aug 2011, and Permits at the slowest pace since April 2011.



Permits missed notably…


With Total Housing Starts dropping by 108K, or the 3rd most since Lehman.


Non-Seasonally adjusted Starts tumbled notably more than in previous years…


And single-family starts – with the benefit of a health seasonal adjustment – are back near pre-Lehman levels… but worryingly… NSA single family of 42.4K is the lowest since January’s 39.4K


Finally, permits Seasonally adjusted vs Non-seasonally adjusted:

6 thoughts on “GREAT YEAR FOR HOUSING STARTS?????”

  1. On the radio this morning an “economist” blamed the plunge in starts because the fed will start to taper soon.

    So, in his mind the fed must continue QE because that is the real economy? We are living in some very interesting days.

  2. Now throw in our population numbers

    How in the hell is it possible to proclaim recovery when reality is that due to our population growth between 1990 and today, hell between 2000 and today, these starts are completely dismal. Now throw in the fact that we currently have millions more households thanks to divorce and single-parenthood.

    I don’t feel like doing the math, but I have an inkling that if you throw population into those charts, we would see the reality of this “recovery” without having to be told.

    When this thing blows it is going to be spectacular!

  3. Speaking of apartments, there is an expressway that runs outside of our office. For a seven or eight block section, it runs through a neighborhood of houses that are shielded by concrete walls from the road. The posted speed at this point is 35 mph. At the end is an apartment complex. Copfuks around here enforce this speed limit to the nut. Yesterday evening as I was driving home from work, I spotted one sitting in the apartment parking lot fellating his radar gun.

    I thought as I drove past, what If I pulled in, got out of my car and walked up to the copfuk and informed him that I own these apartments and that he is trespassing on private property and ask him to leave? Respectfully of course.

  4. @Z, here the apartments are going up like nothing I’ve ever seen. Massive four story soul sucking human barns destined to become breeding grounds of the FSA and the crime that goes with ’em. I not kidding, in two years they’ve put up about 25-30 of these ugly fuckers around town – nobody has a clue where people are coming from to fill ’em.

    BUT GET THIS, they’re 100% rented full before they’ve even been built…… shit. ???????????????

  5. Up here its the somali’s that’ve been brought in by the truckload. They’ve brought so many in that they don’t need to assimilate with the rest of us….so they turn inwards, form gangs, etc.

    So here’s a question……

    Do you really think that the immigrants that get outta some shitty hellhole are the truly down and out of that country or do you think as I do, that the meanest, most cunning, crooked, connected, and ‘determined’ (not in a good way) – used they’re connections/abilities to secure a ticket to the land of the free for now? In my way of thinking, we’ve already got trouble and we’re importing it.


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