U.S. housing starts likely to have remained firm in December

In the U.S., single-family housing construction reached a cycle-high rate of a seasonally adjusted annualized 930,000 units in November. The data came in mixed geographically. Housing starts in the West and in the South rose, while it declined in the Northeast and Midwest.

Revisions from this summer’s hurricanes pushed a considerable portion of building activity into November, which is the main reason for the cycle-high reading. But the trend is quite positive given strong readings in both October and November. The trend in December is expected to have continued.

According to a Wells Fargo research report, residential investment is likely to continue ramping up across the nation, giving a considerable boost to the fourth quarter GDP as well as in 2018.

Revisions from this summer’s hurricanes pushed a significant portion of building activity into November, which is a primary reason for the cycle-high reading. However, the trend is definitively positive given solid readings in both October and November, and we expect December to continue the trend.

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