Housing Starts dipped in December, capping off an uninspiring 2017 that saw total housing starts rise just 2.4%, the slowest rate of the recovery. The TTM rate for Multifamily dipped to -10% YoY while Single Family stayed stead at 8.6%. Diving into the data, we see that the weakness in December appears to be because of the unseasonably cold weather in the Northeast, Midwest, and South. The relative plunge in single family construction compared to multifamily indicates that homebuilders delayed breaking ground, likely leading to a bounce-back in January or February.

As expected, multifamily completions continued to tick higher in December at around 350k SAAR. 601k MF units remain under construction.

Completions will remain elevated throughout 2018, as implied from the prior 24 months of MF starts data. We expect between 360-400k units to be delivered in 2018 up from about 350 in 2017 and 310 in 2016.