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Housing Starts jumps 22.7% to 1.09M

  • Nov. Housing Starts: +22.7% to 1.09M vs. 952K expected and 889K (revised) in Oct.
  • Permits 1.00M vs. 995K expected and 1.04M (revised) in Oct.
Comments (12)
  • bbro
    , contributor
    Comments (9852) | Send Message
     
    The Housing Starts to Nonfarm Payrolls ratio today is .80%...the average ratio for the 1990's was 1.17...the range in the 1990's was .73 to 1.40....the .73
    was in January 1991 with a 30 year mortgage rate of 9.64..the 30 year
    mortgage rate today is 4.50%....

     

    The 6 month moving average of this ratio is well above its 18 month average signifying no recession in sight....
    18 Dec 2013, 08:37 AM Reply Like
  • OptionManiac
    , contributor
    Comments (3342) | Send Message
     
    bbro,

     

    Can I assume the lower the ratio the "better"?
    18 Dec 2013, 09:21 AM Reply Like
  • bbro
    , contributor
    Comments (9852) | Send Message
     
    Yes...think in cycles
    18 Dec 2013, 10:10 AM Reply Like
  • june1234
    , contributor
    Comments (2699) | Send Message
     
    and mortgage apps(which is what most use when purchasing a home) dropped another 5.5% last week a trend in place since May. Wonder whose doing most of the home buying.(sarcasm intended)
    18 Dec 2013, 09:21 AM Reply Like
  • labas112
    , contributor
    Comments (335) | Send Message
     
    I agree. There seems to be a growing deviation from building and applications which cannot be a positive sign.
    18 Dec 2013, 11:24 AM Reply Like
  • OptionManiac
    , contributor
    Comments (3342) | Send Message
     
    There is a lot of cash buying out there - not necessarily by individuals.
    18 Dec 2013, 11:31 AM Reply Like
  • Moon Kil Woong
    , contributor
    Comments (11166) | Send Message
     
    The banks prop up their bad construction loans with more homebuilding loans to build more homes that don't sell well and undermine the housing market. Not like they care about crashing the housing market since the liability is now passed to the taxpayer via Fannie Mae and Freddie Mac.

     

    Some say, well the government is fine because they are now booking profit on Fannie and Freddie without mentioning they are absorbing a potential $4 trillion or more in losses and a rough estimate if they mark to market, they would be losing $1 trillion or more without considering the effects of if they actually had to sell their illiquid loans which they can't sell to anyone but the Federal Reserve that is providing them liquidity by buying them which move the taxpayer liability to the taxpayer. LOL, what a great system.
    18 Dec 2013, 10:47 PM Reply Like
  • vinhvo66@yahoo.com
    , contributor
    Comments (31) | Send Message
     
    It's not good when most of the buyers are from China...
    18 Dec 2013, 10:15 AM Reply Like
  • OptionManiac
    , contributor
    Comments (3342) | Send Message
     
    A lot of buyers are US investment firms setting up rental properties. Usually inflation is a landlord's friend - and with a lack of it there will be little pressure for rental rates to rise. kind of curious how this will pan out.
    Oh, and most of the buyers (a majority!?) are not from China.
    18 Dec 2013, 11:08 AM Reply Like
  • convoluted
    , contributor
    Comments (1968) | Send Message
     
    Investors are still very active. Rents likely to increase. Some business development companies are buying houses and apartments. Quite a few non-public companies are also in the fray. As to mortgage application correlation, there does seem to be an inconsistency. My observations in traveling around are that a lot of retirees get frustrated with the mortgage process and pay cash. There is also an increasing use of reverse mortgages to buy a house-don't know how that's accounted for in the data. With the sheer number of people reaching age 62, it's plausible to see more of this type of activity.
    It's also possible that results get skewed as Florida homebuilding is booming-especially in central Florida, and ditto for some other retirement areas. Perhaps the data would be more meaningful if these segments could be isolated for further study.
    18 Dec 2013, 12:11 PM Reply Like
  • OptionManiac
    , contributor
    Comments (3342) | Send Message
     
    Do you see rents increasing with a boom in rental building and low inflation? If seniors are smart - they rent the first year when moving to a new locale just in case they find that it is not a good fit for them.
    18 Dec 2013, 01:49 PM Reply Like
  • Darren McCammon
    , contributor
    Comments (1291) | Send Message
     
    I wouldn't think rental properties effect housing starts much. Most investors do not buy new build but instead focus on foreclosure, short sale and occasionally resale.
    18 Dec 2013, 02:23 PM Reply Like
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