Highlights
New housing construction in July headed back down to trend sluggishness after an unexpected boost in June. Housing starts dipped 1.5 percent in July, following a 10.8 percent jump in June (originally up 14.6 percent). The July annualized pace of 0.604 million units beat expectations for 0.600 million units and is up 9.8 percent on a year-ago basis. The decline in July was led by a 4.9 percent drop in the single-family component, following a 7.5 percent surge in June. The multifamily component continued upward, gaining 7.8 percent after jumping 21.2 percent the prior month.

By region, the drop in starts was led by a monthly 37.7 percent decrease in the Midwest with the West declining 3.0 percent. The Northeast gained 34.7 percent while the South rose 5.6 percent.

Homebuilders remain cautious as housing permits slipped 3.2 percent, following a 1.3 percent rise in June. The July pace of 0.597 million units annualized came in below the median forecast for 0.606 million. Permits in July are up 3.8 percent on a year-ago basis.

The bottom line is that housing is still extremely anemic with perhaps mild strength in the multifamily component. Until labor markets improve significantly, this sector is likely to remain in the doldrums.

On the news, equity futures edged up but remained significantly negative due to disappointing news on second quarter growth in Europe.

Market Consensus before announcement
Housing starts jumped 14.6 percent in June, following no change in May. June's annualized pace of 0.629 million units is up 16.7 percent on a year-ago basis. The boost in June was led by a 30.4 percent surge in the multifamily component, following a 2.2 percent dip in May. The single-family component rose 9.4 percent after gaining 0.7 percent the prior month. Nonetheless, starts remain at very weak levels.

2011 Release Schedule

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