The often volatile housing starts numbers took another dive this report, down 18.7% in November according to the Census Bureau New Residential Construction report for November 2016.

Housing starts 1959-Present

housing-starts-2016-11a

Year-Over-Year Detail Since 1994

housing-starts-2016-11c

New Residential Construction Details

  • Permits down 4.7% from October
  • Permits down 6.6% from year ago
  • Starts down 18.7% from October
  • Starts down 6.9% from year ago
  • Completions up 15.4% in October
  • Completions up 25% from year ago

Mortgage Rates Soar

mortgage-rates-2016-12-16a

Mortgage rates have risen 104 basis points (1.04 percentage points) since July 8.

As I have pointed out, this is bound to affect the housing market sooner or later. Sooner means now.

Each quarter-point hike will affect mortgage rates correspondingly until the long end of the curve refuses to rise further. At that point, we will be in recession.

Still think three hikes are coming in 2017?

Mike “Mish” Shedlock