by Calculated Risk on 7/18/2007 09:14:00 AM

The Census Bureau reports on housing Permits, Starts and Completions. Seasonally adjusted permits decreased sharply:

Privately-owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,406,000. This is 7.5 percent below the revised May rate of 1,520,000 and is 25.2 percent below the revised June 2006 estimate of 1,879,000.

Starts increased slightly:

Privately-owned housing starts in June were at a seasonally adjusted annual rate of 1,467,000. This is 2.3 percent above the revised May estimate of 1,434,000, but is 19.4 percent below the revised June 2006 rate of 1,819,000.

And Completions declined:

Privately-owned housing completions in June were at a seasonally adjusted annual rate of 1,470,000. This is 6.0 percent below the revised May estimate of 1,564,000 and is 28.2 percent below the revised June 2006 rate of 2,047,000.

Click on graph for larger image.
The graph shows Starts vs. Completions.

As expected, Completions have followed Starts "off the cliff". Completions are now at the level of starts.

This report shows builders are still starting too many projects, although the decline in permits may be a hint that starts will begin to fall again soon. Based on housing fundamentals of excess supply, and falling demand, I expect starts (and completions) to decline significantly later this year.