Housing starts dove to a 17-year low this morning, widely missing consensus and precipitating a broader sell-off in home-builders and financials. Starts came in at 895,000, well below the 950,000 consensus estimate and down from a revised 954,000 last month. (So much for the theory that starts would level off at 1 million).
Building permits, a crucial indicator of future building activity, also missed, coming in at 854,000, nowhere near the 925,000 consensus and well below 937,000 last month.
Of particular concern here is the fact that the total decline in seasonally-adjusted starts year-over-year appears to accelerating again, after two months of deceleration. After peaking in March at 33.78%, the rate of year-over-year decline decelerated over three consecutive months until it settled at 26.89%. Now, the rate has increased again to 33.06%. So much for a housing bottom.
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