Economics: US HOUSING STARTS

Tanked in February, to a 479k pace vs 618k in January revised from 596k and a median estimate of 577k. Single family starts fell 11.8% in the month following a 1.4% gain in January, while the more volatile multi family starts series fell 46.1% following a 87.4% gain. Permit issuance fell to 517k vs a prior 563k, suggesting that while the February decline in starts was exaggerated, the trend is downward. Permits for singles fell 9.3%, multis 4.9%. Completions jumped 13.9% in the month, and homes under construction were fairly steady, so while starts will drag down the totals later in Q1, the GDP impact from housing was not bad at the beginning of the quarter. Housing starts in February were the 2nd lowest on record, right behind April of 2009. That result is not all that remarkable, because housing starts had not climbed very far from the record low in any of the intervening months. Starts have been somewhat noisy the past couple of months, but the 3mo average is running at just about the same level now as in December and January, better than back in the low point in 2009 by just a bit. When it comes to permits, though, we have a new record. The 517k permits reported for February is just a tad lower than the prior 522k low posted in March of 2009, the permits that led to the record low level of starts in April 2009. While permits running above starts is a good sign, record low permits is not.