After a small downward revision in May, Housing Starts soared 6.3% MoM in June (massively beating expectations of +1.2% MoM), but... Building Permits, which are forward-looking of course, saw a third straight month of declines, plunging 5.1% MoM (far worse than the +0.7% MoM expected)...

This pushed the Permits SAAR below Starts for the first time since Jan 2020, and to its weakest since Oct 2020...

Under the hood, Single Family Starts rose 6.3% SAAR to 1.160MM, the highest since March, and Multi Family (rentals) Starts were up 6.8% to 474K, highest since July 2020...

But Permits were far more ugly, with Single Family Permits down 6.3% to 1.063MM SAAR, lowest since August 2020; and Multi Family Permits down 1.6% to 483K SAAR, lowest since Dec 2020.

This is not a pretty picture for the future.

Exorbitant materials costs, combined with shortages of land and labor, have thwarted developers seeking to ramp up construction. Supply concerns and a slowdown in sales pushed builder confidence down to an 11-month low in July, a survey from the National Association of Home Builders showed Monday.

An inventory crunch that followed solid demand last year has sent prices soaring, tempering buyer interest. A record 71% of consumers said higher prices were a reason why buying conditions have soured, according to July data from the University of Michigan.