This morn, the U.S. Census and HUD jointly announced new
residential construction statistics for December 2012.
We are doing a +30% annual increase, in the rear view mirror,
for both permits and starts. Pretty impressive stuff!
Permits weren't too strong in December. Nonetheless,
permits reached their highest level since July 2008. Starts
were very strong. A 954,000 number in starts rounds to a
million now. This was the highest rate in four years.
Two-thirds of starts were single family. One third was
"5 units or more", which are apartments. By far, the
apartment growth rate is the more impressive of the two.
Is there more runway here? 1.5 million in starts is what we
need to meet U.S. population growth.
However, the question for investors is this "Have the
homebuilders run up too far and too fast?" The ishares Dow
Jones Construction Index (ticker:
) is up 68% over the last year.
Here is the data --
Privately-owned housing units authorized by building permits
in December were at a seasonally adjusted annual rate of 903,000.
This is 0.3% (±1.0%)* above the revised November rate of 900,000
and is 28.8% (±1.4%) above the December 2011 estimate of
Single-family authorizations in December were at a rate of
578,000; this is 1.8% (±1.0%) above the revised November figure
of 568,000. Authorizations of units in buildings with five units
or more were at a rate of 301,000 in December.
An estimated 813,400 housing units were authorized by building
permits in 2012. This is 30.3% (±1.1%) above the 2011 figure of
Privately-owned housing starts in December were at a
seasonally adjusted annual rate of 954,000. This is 12.1%
(±13.4%)* above the revised November estimate of 851,000 and is
36.9% (±22.0%) above the December 2011 rate of 697,000.
Single-family housing starts in December were at a rate of
616,000; this is 8.1% (±9.7%)* above the revised November figure
of 570,000. The December rate for units in buildings with five
units or more was 330,000.
An estimated 780,000 housing units were started in 2012. This
is 28.1%(±2.6%) above the 2011 figure of 608,800.
My question for you today….
If permits and starts are up +30% and broad share
indexes are up +68%, is it time for a pull-back in
ISHARS-DJ HO CO (ITB): ETF Research Reports
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