Housing Numbers Down: Was it Just Bad Weather, or is There More Turbulence Ahead?  

By at 18 March, 2021, 11:54 am

by Raymond J. Keating-

The housing numbers served up by the U.S. Census Bureau were ugly for February. That’s troubling given that housing has been a major bright spot for the economy during this pandemic economy, as well as the fact that housing very much is about small business.

The data pointed to housing starts being down by 10.3 percent in February versus January, while permits (a measure of future housing starts) were off by 10.8 percent.

A couple of quick caveats are called for regarding these numbers.

First, month-to-month housing data can be quite volatile and subject to notable revisions.

Second, housing has made a nice bounce back after the pandemic initially hit.

And then there was the weather in February, with huge swaths of the country immersed in deep cold. That obviously had some effect on these housing numbers. The weather also had an impact on industrial production in February.

So, it’s hard to get a clear picture on what’s happening with housing and other parts of the economy given the weather distortions. That makes the March and April numbers even more important in terms of telling us whether the February dip was temporary due to passing factors, or something to get more concerned about regarding our economic recovery.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.


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