Housing permits and starts ticked up in October from the prior month, led by single-family construction that has surpassed year-earlier levels, but contract prices for PVC for construction were flat on the month.
Housing starts were at a seasonally adjusted annual rate of 1.372mn units in October, 1.9pc higher than September but 4.2pc lower than October 2022, according to data from the US Census Bureau and the Department for Housing and Urban Development (HUD). Housing starts have grown for two straight months, but October's growth was smaller than September's.
Single family starts were at a rate of 970,000 units, just 0.2pc above September but 13.1pc higher than October 2022. The single-family construction market has show signs of genuine recovery from the sharp declines that occurred in the second half of 2022, when rising interest rates from the Federal Reserve started to weigh heavily on construction and home buying.
Now a over a year into the Fed's push to raise interest rates, housing starts and permits have seen uneven growth but a relative improvement starting in the late summer. That month-to-month growth is starting to level off.
PVC demand followed the construction sector, with demand improving from August to September compared to the earlier part of the summer. By late summer, domestic PVC buyers and converters had largely worked through old inventories, leaving them needing fresh resin when housing construction demand started growing in the early fall. By October, just as construction demand started cresting again, PVC demand stagnated and October contract prices rolled flat at 59.5¢/lb.
Permits were at a seasonally adjusted annual rate of 1.487mn units in October, 1.1pc above September but 4.4pc below October 2022.
Single family permits still continued the month-to-month growth that's lasted all year, but they grew by the smallest percentage since January 2023. Single-family permits were at a rate of 968,000 units in October, just 0.5pc above September but 13.9pc higher than October 2022.
