Continuing evidence that the slowdown in bank lending is reflecting slowdowns in the macro economy:
Single-family permits continue to rise in what, however, is the main positive in an otherwise weaker-than-expected housing starts and permits report. Looking first at headline totals, starts fell 4.7 percent in September to a 1.127 million annualized rate which is well under Econoday’s low estimate. Permits fell 4.5 percent to a 1.215 million rate that is above the low estimate but below the consensus for 1.238 million. Hurricane effects aren’t striking despite affected areas accounting for more than 1/4 of the total.
First the good news as permits for single-family homes rose 2.4 percent to an 819,000 rate and a year-on-year gain of 9.3 percent. Single-family homes are the backbone of the housing sector and strength here not only points to greater supply in the new home sales market but also to gains ahead for residential investment in the GDP report.
Not good news are permits for multi-family units which fell 16.1 percent to a 396,000 rate with this yearly rate at minus 24.0 percent. Multi-family units had shown strength earlier in the year but have since tailed off.
Starts for multi-family units fell 5.1 percent to a 298,000 rate with single-family starts down 4.6 percent to 829,000. Single-family completions offer some good news, up 4.6 percent to a 781,000 rate and adding immediate supply to the market.
Regional data do show what is likely hurricane-related weakness in the South, where starts fell 9.3 percent to 527,000 following August’s 4.9 percent decline. Yet also weak were starts in the Midwest, down 20.2 percent to 154,000, and also the Northeast, down 9.2 percent at 119,000.
Housing has been generally slowing and looks to end 2017 no better than flat. Still, permits and completions for single-family homes are solid pluses.
The president has a right not to like the ACA. But so long as it is the law of the land, he does not have the right undermine it through the use of executive power.
“Faithful” execution of a law that is validly on the books is what the words of the Constitution require of Trump — until Congress decides otherwise.