Housing Permits Grow at Slowest Rate since January
There were 96,800 housing permits filed in September 2015. This was the fewest housing permits filed since March 2015. And, in only one month since August 2007 have housing permits been above the historical average. Comapred with one year ago housing permits were up 4.4 percent in September. This was the 10th consecutive month of growth, but it was the slowest rate of growth since January 2015. The annual rate of growth, not 9.7 percent, decelerated to its slowest rate since of growth since May 2015. It appears that rising real interest rates are starting to impact housing permits.
The 10-year treasury rate has begun a trend of rising rates compared with one year ago. It appears that housing permits have hit their peak rate of growth. Changes in the interest rate lead changes in housing permits and construction spending by about 12 months on average.
We use housing permits as an early leading indicator for the following industries: appliances; custom processors; furniture; hardware; HVAC; off-road/construction machinery; petrochemical processors; plastics; plastic/rubber products; pumps/valves/plumbing products; textiles/clothing/leather goods; and wood/paper products.
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