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By the Numbers

Featuring brief segments of economic analysis from our senior economist Michael Bazdarich, PhD.

The economic analysis we previously featured in By the Numbers is now available on the Western Asset Blog. This page will no longer be updated.

October Housing Starts Up: Echoes of a Year Ago

Single-family housing starts jumped 4.2% in October, following up on a positive retail sales release last week. Single-family housing activity had been languishing for most of the last year, so the October news was indeed a break. In fact, the October gains announced today look similar to the starts spike we saw in November 2013.

That prior gain also occurred virtually out of the blue, and it occurred with no accompanying gains in single-family permits or completions, as was also the case this time around. (See chart.) Alas, that November 2013 spike was reversed in subsequent months.

Across geographic regions, the October gains in single-family starts were wholly contained in the South. This was also the case with the November 2013 spike.

Meanwhile, on the multi-family front, starts were down in October, holding down the headline starts number. Multi-family activity has continued to flatline over the last year, though with substantial month-to-month volatility.

Maybe the October 2014 single-family starts gains are the real thing, and maybe they are one more flash in the pan. We’ll have to wait and see. The narrowness of the gains—both across housing indicators and across geographical regions—suggests the latter. Still, with this month’s gains in hand, it is clear that the housing data bear closer watching in the months to come.

Single-Family Homebuilding
October Home Sales Chart
Source: Census Bureau. As of 31 Oct 14.

Michael Bazdarich

Product Specialist/Economist

Mike brings more than 43 years of experience to his position. "By the Numbers" will address economic data releases that are pertinent to a broad range of investors.

Prior to joining the Firm in 2005, Mike ran his own consulting firm, MB Economics. He earned his PhD in Economics at the University of Chicago.

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