US home construction falls in Dec, but single-family shows gains

19 January 2012 14:26  [Source: ICIS news]

WASHINGTON (ICIS)--US new home construction fell by 4.1% in December from November, the Commerce Department said on Thursday, but most of the decline was attributed to a sharp drop in apartment units while the core single-family sector saw a 4.4% gain.

In its monthly report, the department said that the number of housing starts in December were at a seasonally adjusted annual rate of 657,000, down by 4.1% from the November figure of 685,000.

Although the overall pace of new residential construction was lower than in November, the December rate shows a marked improvement from the year-earlier period, at nearly 25% above the December 2010 figure of 526,000 units.

Within the overall housing construction data – which includes work on one-family homes, condominium units and multi-family apartment rental buildings – the numbers for single-family housing starts look better.

The department said that single-family housing starts in December were at a seasonally adjusted annual pace of 470,000, 4.4% higher than the November rate and 11.6% ahead of the December 2010 figures.

Housing construction is a key downstream consumer sector for the chemicals industry, driving demand for a wide variety of chemicals, resins and derivative products such as plastic pipe, insulation, paints and coatings, adhesives, roofing materials and synthetic fibres, among many others.

The American Chemistry Council (ACC) estimates that each new home built represents some $15,000 (€11,700) worth of chemicals and derivatives used in the structure or in production of component materials.

The department also reported that the number of residential building permits issued in December was essentially flat with November’s pace, showing a narrow decline of 0.1% to 679,000.

Building permits are issued by local governments when contractors are ready to break ground and begin construction of a residential structure, so monthly permitting data are seen as a real-time indicator of the housing sector’s near-term prospects.

Although the December permits data suggest that the pace of new home construction in the current month will have little improvement, those figures also show that anticipated home construction is nearly 8% ahead of the December 2010 level of activity.

US Housing Starts

 

Dec ’11

Nov ’11

Nov - Dec ’11

Dec ’10

Dec ’10 to Dec ’11

US Housing Starts

657,000*

685,000*

-4.1%

526,000*

24.9%

* Seasonally adjusted & annualised

($1 = €0.78)

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy


By: Joe Kamalick
+1 713 525 2653



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