The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for May new residential housing starts. The latest reading of 974K was below the forecast of 1.095M and a slight increase from the previous month's revised 934K.

Here is the opening of this morning's monthly report, including a note on revisions:

Statement Regarding COVID‐19 Impact: Due to recent events surrounding COVID‐19, many governments and businesses are operating on a limited capacity or have ceased operations completely. The Census Bureau has monitored response and data quality and determined estimates in this release meet publication standards.

Housing Starts

Privately-owned housing starts in May were at a seasonally adjusted annual rate of 974,000. This is 4.3 percent (±15.5 percent)* above the revised April estimate of 934,000, but is 23.2 percent (±6.2 percent) below the May 2019 rate of 1,268,000. Single-family housing starts in May were at a rate of 675,000; this is 0.1 percent (±11.9 percent)* above the revised April figure of 674,000. The May rate for units in buildings with five units or more was 291,000. [link to report]

Here is the historical series for total privately-owned housing starts, which dates from 1959. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.

Housing Starts

The Population-Adjusted Reality

Here is the data with a simple population adjustment. The Census Bureau's mid-month population estimates show substantial growth in the US population since 1959. Here is a chart of housing starts as a percent of the population. We've added a linear regression through the monthly data to highlight the trend.

Housing Starts Population-Adjusted

A Footnote on Volatility

The extreme volatility of this monthly indicator is the rationale for paying more attention to its 6-month moving average than to its noisy monthly change. Over the complete data series, the absolute MoM average percent change is 6.3%. The MoM range minimum is -26.4% and the maximum is 29.3%.

For visual confirmation of the volatility, here is a snapshot of the monthly percent change since 1990.