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Economic & Equity Update

Steven C Wieting, Managing Director US Developing Markets Economics

U.S. Macro Flash: Oct. Housing Starts Drop 10.6% on 34.6% Drop in Multi-Families; Show Effects of Policy Uncertainty; CPI +0.3%, Core +0.2%

November 18, 2009

  • Housing starts unexpectedly fell 10.6% in October, with multi-family starts plunging 34.6%; Weakness in commercial real estate credit and a lack of earlier adjustment may be working against this segment.
  • Single-family starts fell 6.8%, though single-family permits fell just 0.2%. The first-time homebuyer credit appears to have boosted activity some, creating payback in October. However, incentive effects appear much larger in autos.
  • Overhang from the existing home market, foreclosures and credit issues will limit housing's upside. However, single-family construction is positioned for a modest recovery away from the distortions of waxing and waning subsidies.
  • For more, please read the full report below.

Read the Report (PDF)


 

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