Following the weather-related collapse in US housing starts in February, homebuilders likely made up for lost time in March.
The 17% m/m plunge in housing starts in February was in large part due to unseasonably severe winterweather in the Northeast and Midwest, where starts fell by 57% and 37% respectively. With the weather conditions far less severe in March, homebuilders were likely keen to make up for lost time.
After all, the survey evidence shows that most builders see conditions as favourable, and the 3% m/m increase in building permits in February showed that they were expecting to break ground on more projects.
"We have pencilled in a strong rebound in starts to 1.1m annualised in March, from 897,000 previously. This would sit well with an upturn in the NAHB index of homebuilder confidence to around 55 in April", says Capital Economics.
