- by New Deal democrat
Originally housing permits and starts through December were supposed to be updated this morning, but that has now been put off another week. In the meantime, we did get some data, albeit stale, about the important leading sector of construction, in the form of the construction spending report through October. And it added to the very small patch of evidence suggesting that some “green shoots” may be forming.
To wit, as shown in the graph linked to below, in October nominally total construction spending rose 0.5%. More importantly, the long leading sector of residential construction spending rose 1.3%. Since the cost of construction materials in the last PPI report declined -0.2%, in real terms spending rose 0.7% and residential spending rose 1.5%:
In absolute nominal terms, both series rose to close to 10 month highs:
In real terms, residential construction also made a 9 month high:
Keep in mind that construction spending is one of the latter housing series to turn, although it generally turns before housing units for sale and residential construction employment. Across almost all the more leading housing data, the trend in the past few months has been a leveling out or even some small improvement. Even prices (which follow sales) may be leveling out.
All of this is downstream of the 3 year lows in mortgage rates. Of such small things are “green shoots” made (subject, of course, to longer term interest rates blowing out to the upside due to T—-p’s blowing up NATO).
