Housing Permits Peaking?

There were 97,700 housing permits filed in March 2016. Comapred with one year ago, housing permits increased 7.0 percent. This was the fifth month in a row that housing permits increased month-over-month, but it was virtually the slowest rate of growth for those five months. And, the annual rate of growth was unchanged from the previous month. The current rate of annual growth of 11.7 percent was the fastest since April 2014.

The real 10-year treasury rate has increased at a slower rate for several months. Typically, this indicates accelerating growth in housing permits. 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.