EmailHousing starts fell 1.5% in July, dropping from 613,000 in June to 604,000. The Briefing.com consensus expected starts to fall to 608,000.
Single-family starts fell from 447,000 in June to 425,000 in July. Multi-family starts increased from 160,000 in June to 170,000 in July.
Typically, single-family starts follow a stable trend. Thus, the nearly 5% drop in July confirms anecdotal reports from April and May that poor weather caused a delay in many construction projects until June. The July single-family starts level fell back to its previous three-month average.
Multi-family starts, on the other hand, are notoriously volatile and the increase in these starts are more likely random fluctuations. It would not be surprising to see these starts tumble next month while single-family starts remain near their current level.
After a brief respite in June where the number of homes currently under construction increased for the first time since May 2006, builders returned to a downward moving trend in July. The number of homes currently under construction fell from 416,000 to 413,000. This is the lowest level in the history of the dataset.
The drop in the number of homes under construction suggests that builders believe that inventory levels remain too high for near-future demand.
