Housing Starts: Signs of Bottoming

Bottom Line:  Housing starts fell less than expected in March as single-family starts rose for the third month, but multi-family declined. Large multi-family developments slowed most sharply, but the segment was still historically quite robust. Single-family activity, meanwhile, had been contracting sharply since this time last year but appeared to be bottoming late in the 1st Quarter. Permits for new single-family projects also rose modestly. Overall, demand remains strong even at lower affordability, and there's scope for new housing activity to bottom amid low supply of existing homes, where many homeowners are reluctant to move as they enjoy mortgage rates well below current market levels. While housing activity remained a drag on economic growth through the 1st Quarter, there's now scope for steady residential investment in the 2nd Quarter and a return to positive growth in the 2nd Half.

Total US Annualized Housing Starts FELL 12k to 1.42M, ABOVE the 3-Month average of 1.4M, ABOVE the 6-Month average of 1.4M but 296k BELOW the year-ago level.