Goin’ Down! US Housing Starts Drop -6.3% YoY In June Thanks To Fed Tightening (1-Unit Starts Dropped -8% MoM, Multifamily Starts Soared 15% MoM)

Confounded Interest ^ | 07/19/2022 | Anthony B. Sanders

[Browns Ultra Fan]

The US is goin’ down. At least in terms of housing supply.

The US is short on supply of housing for a myriad of reasons (high costs, Not-in-my-backyard (NIMBY) local zoning laws, etc), but The Fed’s cranking up interest rates isn’t helping.

US housing starts, a measure of supply, declined -6.3% YoY in June as The Fed cranked up rates.

1-unit (aka, single family detached) starts dropped -8.05% MoM in June while 5+ unit (aka, multifamily) starts rose 15% MoM.

1-unit permits dropped -8% MoM in June while 5+ unit starts were up 13% MoM.

The reason? REAL weekly earnings growth declined -4.4% YoY in June thanks to Bidenflation.

I hope you are enjoying Biden’s anti-fossil fuel agenda since it is killing us.

[Browns Ultra Fan]

Biden's energy policies are killing the US.

[central_va]

Raising interest rates to slow the economy is kind of evil. Like bleeding a patient in 13th century Europe.

[TomGuy]

Thanks To Fed Tightening

For this current runaway inflation train, a 3/4 point FED increase is hardly "tightening".

Social Security COLA was expected to increase around 9% based on May figures. When the June figures came out, that was adjusted UP to possibly 10.8%. Those are MASSIVE COLA numbers -- record-setting numbers.

Another 3/4 point FED increase is not going to do much against this runaway inflation train.

We used to put a penny on the train tracks to see the aftermath -- a flat chunk of copper. That is how the FED tightening is impacting this inflation train.

[know.your.why]

Well this is likely to hit my pocketbook even harder when my apartment lease expires in January. I bet the management here will demand an increase on my rent of 20% or more, and you can bet that I’ll be ranting about it here. Thanks Brandon! LGB. FJB. I bet that in one years’ time my cost of living will have increased by $400-$700 a month come January 2023. Its already up by $300/mo easy and it aint a pandemic, Putin, or fillintheblank excuse thats to blame. Its all Liberal Democrat Globalist tax & spend (my money) failed policies.

[skeeter]

Imagine being a retiree who depends upon a 401k as a fixed source of income in this economy.

With not even a sympathetic journalist to tell your story.

At least, not until the rats lose control of the House.

[grey_whiskers]

Multi-family == Illegal immigrant and H1-B housing

[TomGuy]

Imagine being a retiree who depends upon a 401k as a fixed source of income in this economy.

I am one of those who doesn't have to imagine it. I am living it, as a 74-yo retiree living on SS and some cash saving dwindling cash savings.

[Not_Who_U_Think]

You are so right, once the rats lose the House, it will be time to write all those sad stories. They’ll discover how bad it is, and ask “WHAT ARE YOU REPUBLICANS DOING ABOUT IT??”

Too many see the Dems as the good guys who give them free money - and the Reps as the meanies who take it away.

[millenial4freedom]

well, we all have to atone for our white privilege some way or another. /s

[skeeter]

You have my sympathy. Mine has lost 20% in the past 18 months.

Luckily I don’t need it - yet.

[know.your.why]

well, we all have to atone for our white privilege some way or another. /s

Since the color white is all colors in the spectrum blended together shouldn't that mean..... And since black is the absence of color, then that would mean.... hmmmm....

[Huskrrrr]

But hey, Ben and Jennifer are back together. Extreme sarcasm.

[woodbutcher1963]

Energy policy has very little to due with housing costs.

The real issue is that the price of housing in most major US markets has become too expensive for the average person/family. The disparity between expensive markets like San Jose, San Francisco, NYC, LA, and Seattle has equalized with other markets.

Markets like Boise, Austin, Tampa, Coeur d’Alene/Spokane, Phoenix, Denver, Myrtle Beach, Salt Lake, Raleigh have all doubled in price in the last few years. A 100% price increase in 3-5 years is NOT SUSTAINABLE.

All real estate markets are going to adjust down in price over the next couple years. Boise already has started down.
All will follow. It is just a matter of how much.

This effect will primarily be seen in single family home prices. There is still a shortage of multi family homes(apartments and condos). Therefore, the housing industry will shift to build more of this type of home.

The RENT is too damn high. This is because there is more demand for apartments than there is availability. So, proportionally multifamily housing is going to increase in comparison to single family. This is what the most recent housing starts report is telling us.

The problem is if you purchased for the first time in the last two years and you need to SELL. These people could soon be off sides on pricing. If you can not sell your existing home profitably in San Jose, you can’t buy the new one in Idaho or AZ or TX. Hence, we will get a ripple effect across the whole industry.

[Regulator]

“Multi-family == Illegal immigrant and H1-B housing” === Rat Voters

[Seruzawa]

Goin’ Down.

https://www.youtube.com/watch?v=hP_dhj7nd8Y

[webheart]

I don’t know who this Anthony B Sanders is but he sure does complain a lot. Everything is YoY to this guy. One year to the next things will go up or they will go down. What is the big deal? If you see a 50 percent drop, call me.

[virgil]

Even suburban women have 401ks that I’m sure they’re watching very closely.