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Housing Recovery False Alarm – Starts, Permits Plunge In July As Rental Units Collapse

by Tyler Durden

Following June’s huge surprise jumps in Housing Starts (revised lower) and Building Permits (revised notably higher), July saw both starts and permits plunge (-4.8% and -4.1% respectively) dramatically missing expectations. The majority of the plunge is driven by multi-family starts crashing 35.2% YoY to its lowest since Sept 2016.

 

Permits’ 7.4% June surge was revised up to a 9.2% spike (the biggest since Nov 2015) before July’s plunge.

 

Multi-Family Starts plunged to the lowest levels since September 2016…

 

This is a 5.6% slump in Housing Starts…

With Multifamily starts crashing 17.1% sequentially and 35.2% year-over-year – this is the 5th month in a row of year-over-declines…something that hasn’t happened outside of recession

 

Permits drop was also dominated by multi-family…

 

The Northwest and Midwest saw over 15% crashes in starts MoM but The South dominates the trend with a 16.5% collapse year-over-year.

 

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