Housing Permits Hit Highest Rate Since June 2015

In October 2019, housing permits soared to their highest level since June 2015 and second highest level since June 2007.

There were 131,700 housing permits filed in October 2019. The month-over-month change in permits was 17.0%, growing at an accelerating rate for the fourth-straight month. September’s rate of month-over-month growth was the fastest since November 2015.

In October, the annual rate of change grew 2.2%, accelerating for the second month in a row. The annual rate of growth will continue to accelerate in the months ahead as the three-month rate of change was 13.8% in October.

The trend in the 10-year Treasury rate is indicating growth in housing permits, too. In October, the year-over-year change in the real 10-year Treasury rate was -0.77%, which was the 10th month in a row that the change was negative, meaning the rate dropped from what it was one year ago.

The change in the 10-year Treasury rate is a good leading indicator of housing permits and construction spending. A decreasing year-over-year change in the real 10-year Treasury rate should lead to increases in these data points down the line.

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