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Economic Update
Housing Permits, Starts, Sales and More

Economic Update

Good Beginning to Year for Housing Permits
Over the first half of this year, single-family permits posted a gain of 6.3 percent over the same time last year according to the National Association of Home Builders. This in spite of the Northeast showing a 2.3 percent year-to-year decrease in this category in the first six months of 2018. Multifamily permits performed even better, finishing the first half of the year 7.1 percent higher than last year - with Southern and Western states growing 13.6 percent and 7.1 percent respectively.

Economic Update

Construction Starts Show Some Promise
Housing starts increased 0.9 percent month-to-month in the most recent report, with the Wells Fargo Securities Economics Group reporting that builder confidence remains at a high pace. The single-family category mirrored overall housing starts with a 0.9 percent gain, and housing starts of projects with five or more units climbed 3.1 percent. Total construction starts, though down month-to-month, are up 2 percent in the first seven months of this year compared to last year, determined Dodge Data & Analytics.

Economic Update

Continued Rise in Construction Costs
For the 22nd consecutive month, costs associated with construction have gone up. The index put together by HIS Markit, and the Procurement Executives Group showed higher costs in August compared to July, but the pace of the increase was slower month-to-month. Materials/equipment grew 8.8 percent slower in August than July, and subcontractor labor costs rose at a 9.0 percent slower pace in that same period. The index forecasts that costs will continue to expand in the next six months but at an even slower pace.

Economic Update

The Slow Lane for Home Sales
July's new home fell 1.7 percent - three of the last four months have seen decreases in this category - and existing sales did just a little better, coming in at -0.7 percent month-to-month. This puts existing home sales at a 1.5 percent drop year-to-year. In new home sales, the Northeast region dove 52.3 percent in July: blamed mostly on the constant downpours. But the West region actually gained 10.9 percent compared to June, and the Midwest region improved 9.9 percent.

Economic Update

Consumers Still Optimistic
Following a small increase in July, the Consumer Confidence Index had a strong showing, up 5.5 points in August. The Wells Fargo Securities Economics Group attributed this to a "tightening labor market, as the share of consumers stating jobs as plentiful was little changed, and those who see jobs as hard to get fell 2.1 points." Both the present expectations category and the future expectations category posted gains. Employees reported that they expect their incomes to improve in the next six months.

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May 21, 2019, 4:34 pm PDT

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