Highlights
Ground breaking for new homes rebounded as multifamily starts came off recession lows. But single-family starts took a step back. Housing starts in August rose 1.5 percent, following a revised 0.2 percent drop the previous month. The August pace of 0.598 million units annualized was down 29.6 percent year-on-year and essentially met the market forecast for 0.600 million units. The rebound in August was led by the multifamily component which jumped 25.3 percent after plunging 15.2 percent the month before. However, the single-family component slipped 3.0 percent after rising 3.3 percent in July. Overall, however, starts have risen significantly since recession bottom. A faster pace likely would be unhealthy given the relatively moderate recovery in sales.

By region, the August rebound in starts was led by a monthly 23.8 percent comeback in the Northeast, following a 22.2 percent fall in July. For the latest month, starts in the Midwest rose 0.9 percent; the West was flat; and the South declined 2.4 percent.

Housing permits also made a comeback, rising 2.7 percent, following a 1.1 percent dip in July. Permits in August came in at an annualized 0.579 million units and were down 32.4 percent on a year-ago basis.

Earlier this week, Fed Chairman Ben Bernanke said that the recession very likely is over. The August boost in housing starts adds to those odds.

The markets are likely to react little to today's starts news as the numbers were right at expectations. However, initial jobless claims were better (lower) than expected and that could nudge equities up.

Market Consensus Before Announcement
Housing starts in July slipped from June's gain but the important single-family component continued its uptrend. Overall housing starts in July edged down 1.0 percent to an annualized pace of 0.581 million units. But single-family starts have risen five months in a row with this component rising 1.7 percent in the latest month. Single-family starts were up 37.3 percent from the recession low. The recent uptrend in single-family starts is good news but the rate of improvement is not likely to continue given that supply of unsold homes on the market remains high.

2009 Release Schedule

Released On: 1/22 2/18 3/17 4/16 5/19 6/16 7/17 8/18 9/17 10/20 11/18 12/16 Released For: Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov