Housing Starts/Permits Disappoint Amid Tumbling Demand For City-Living

After May’s big rebound in both starts and permits, June was expected to show further ‘recovery’ in the US housing market (with starts surging far more than permits) as mortgage rates plunged to record lows.

And while both Housing Starts (+17.3% MoM) and Building Permits (+2.1% MoM), rose notably, they both missed expectations by a mile (+22.2% and +6.3% respectively), though revisions impacted that spread notably.

Source: Bloomberg

The “V”-shaped recovery is already stalling out…

Source: Bloomberg

One of the big drivers of this disappointment was the clear evidence of an exodus from city-living or rentals – Single-Family Home permits were up 11.8%, Multi-family permits down 14.0%…

On the Housing starts side (less forward-looking than permits), single-family units rose 17.2% and multi-family rose 18.6%…

…as the northeast exploded 111.8% from 49K SAAR to 105K (with Single-family starts in the northeast jumping the most since 1990!)…

And Starts remain lower year-over-year…

And all this as homebuilder sentiment surges back towards record highs.