Housing Starts up but Still Low.

MBA Mortgage Applications  (week ended 12/11/2015)

– Purchase Index Week/Week -3.0%. Previous weeks were +0.04%, +8.0%, -1.0%, +12.0%, +0.1%, -1.0%, -3.0%, +16.0%, -34.0%, +27.0%, -6.0%, +9.0%, and -4.0%.

– Refinance Index Week/Week +1.0%. Previous weeks were +4.0%, -6.0%, -5.0%, +2.0%, -2.0%, -1.0%, -4.0%, +9.0%, -23.0%, +24.0%, -8.0%, +18.0%, and -9.0%.

– Composite Index Week/Week -1.1%. Previous weeks were +1.2%, -0.2%, -3.2%, +6.2%, -1.3%, -0.8%, -3.5%, +11.8%, -27.6%, +25.5%, -6.7%, and +13.9%.

Year-on-year, purchase applications are up 3%.

 

Housing Starts  (November 2015)

 
– Starts seasonally adjusted, annualized  1,173,000. Previous was 1,062,000
– Permits seasonally adjusted, annualized 1,289,000. Previous was 1,161,000.

Single family starts were +7.6% month-on-month. Year-on-year single family starts were +9.and apartment buildings (5+ units) were +38.9%.

The increases are fine but the fact is that eight years after Housing Starts started declining they are still well below the 1,500,000 level which is needed to sustain population growth

and to replaced damaged or obsolete housing units.  In addition the gains for the year are much stronger in apartment buildings than in single family.

The data has high regional variations. Total unit gains by percent were stronger in the Mid-west. Single family percentage gains were strongest in the West.

 
Industrial Production  (November 2015)

– Production month/month -0.6%. Previous was -0.4%
– Manufacturing month/month +0.0%. Previous was +0.3%
– Capacity Utilization Rate  77.0%. Previous was 77.5%.

Manufacturing is dead flat.  Overall production which includes mining and oil production is down. This is a consequence of falling commodity prices.

 

PMI Manufacturing Index Flash  (December 2015)

– Index level  51.3. Previous was 52.6.

New orders are at the slowest pace in two years.  This likely reflects a decrease in exports due to weakening economies elsewhere.