The miss on the NAHB house market index in the US Monday seemed to have an outsized impact

A heads up for more housing market data due from the US today. Will lightening strike twice?

I doubt it, but being a good scout …. be prepared

Due at 1330GMT, Housing starts for October

  • expected ++1225K, prior +1201K
  • expected +1.8% m/m, prior -5.3%

Building permits also, at the same time

  • expected 1260K, prior 1270K
  • expected -0.8% m/m, prior +1.7%

Previews:

Barclays:

  • Housing starts: We forecast housing starts to increase 1.0% m/m, bring the level of start to 1.213mn annualized in October.
  • Beyond the monthly volatility, starts activity has softened somewhat since the beginning of the year - starts stood at 1.334mn in January versus 1.201 in September. Much of the decline was concentrated in multifamily structures, which fell to 330k in September (versus 448k in January) as the market is likely correcting some of sharp acceleration in multifamily starts during the recovery, and it also takes into account signs that rental price pressures are softening in large metropolitan areas.

Citi

  • Housing starts should rise slightly to 1210K (annualized) in October after declining to 1201K in September. This would be in line with our generally soft outlook for housing activity over the coming months, as this sector of the economy is likely to continue to feel the downside effects of rising mortgage rates weighing on activity.
  • Building permits should similarly be soft in October, declining moderately to 1266K permits issued, from 1270K in September. While some weakness in building permits recently has been due to the more volatile multifamily component, single family permits have also trended gradually downwards (Figure 12). Further weakness in this component of building permits would continue to spell downside for housing.
  • We do not expect a sustained rebound in housing activity in the near term, and residential investment is likely to be close to flat through the first half of 2019 as well.