US Housing Starts Collapsed In March – Biggest Drop Since COVID Lockdowns

The roller-coaster ride in housing permits, starts, and completions in the last few months is set to continue today… and ‘surprise’ they did. After a big (+10.7%) surge in February, Starts crashed 14.7% MoM in March (massively worse than the 2.,4% drfop expected). Building Permits also plunged (-4.3% MoM vs -0.9% exp)…

For context, this is the largest MoM drop in housing starts since the COVID lockdowns…

Source: Bloomberg

It was a bloodbath across the board with Rental Unit Starts plummeting 20.8% MoM…

Source: Bloomberg

That pushed total multi-family starts SAAR down to its lowest since COVID lockdowns…

The plunge in permits was less dramatic and driven completely by single-family permits down 5.7% to 973K SAAR, from 1.032MM, this is the lowest since October. Multi-family permits flat at 433K

Intriguingly, while starts and completions plunged in March, the BLS believes that construction jobs surged to a new record high…

Source: Bloomberg

Finally, just what will homebuilders do now that expectations for 2024 rate-cuts have collapsed?

Source: Bloomberg

One thing is for sure – do not trust what homebuilders ‘say’ (as NAHB confidence jumped to its highest since May 2022 at the same time as housing starts crashed)…

Source: Bloomberg

If they build them, will homebuyers come?

Source: Bloomberg

Maybe, but it will be bloody expensive for them!