It was the week of the month dominated by housing numbers.
The NAHB homebuilder sentiment index rose from 37 in August to 40 in September, which beat consensus estimates of a 38 figure, and was led by all three index components: current sales, expected future sales and prospective buyer traffic. The other good news is that that the index is now at its highest level since mid-2006.
Housing starts rose less than expected in August, at +2.3% month-over-month versus a forecast +2.8%. This translated to an annualized level of 750k units, which is better than the 500k and under figures we became used to during the depths of the financial crisis, but remains below the long-term average level of a million homes a year we need to keep up with population growth. So, better, but still room to go. The good news in this report is that the increase consisted of a +5.5% rise in single-family starts, which offset a nearly -5% drop in starts from multi-family (a surge in multi-family building has been the recent trend). Housing permits fell -1.0% in August, month-over-month, which was better than the expected drop of -1.9%.
Existing home sales rose strongly in August, up +7.8% to an annualized level of 4.82 million units, versus a forecast +2.0% gain. The gain in sales occurred in both single-family homes and condos, although the single-family homes figure was a bit better. This represented more good news for housing, as were existing home prices, which came in at a +9.5% gain on the trailing year. The months’ supply of homes fell to 6.1 months. Read more