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Housing Starts are a measure of the number of residential units on which
construction is begun each month. A start in construction is defined as the
beginning of excavation of the foundation for the building and is comprised
primarily of residential housing. Building permits are permits taken out in
order to allow excavation. An increase in building permits and starts usually
occurs a few months after a reduction in mortgage rates. Permits lead starts,
but permits are not required in all regions of the country, and the level of
permits therefore tends to be less than the level of starts over time.
The monthly national report is broken down by region: Northeast, Midwest,
South, and West. Briefing recommends analyzing the regional data because they
are subject to a high degree of volatility. The high volatility can be
attributed to weather changes and/or natural disasters. For example, an
unexpectedly high level of rain in South could delay housing starts for the
region.
Index
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