Economic Snapshot: Harsh winter weather brings declines in housing

Builder confidence and housing starts both dropped this month, likely due to the harsh weather we have experienced across the country this winter. Most economists seem to agree that these setbacks are temporary.

Housing market index

The Housing Market Index dropped two points to 53 in March but remains up year-over-year from a report of 47 in March 2014.

Any number over 50 indicates the more builders view conditions as good than poor.

Two of the three index components posted declines this month. The component gauging current sales conditions fell three points to 58 and the component measuring buyer traffic decreased two points to 37.

The gauge charting sales expectations for the next six months remained unchanged at 59 in March.

The Northeast and South’s regional scores both posted a two-point drop to 43 and 55, respectively, this month. The West saw the sharpest declines, falling seven points to 61. The Midwest is the only region that posted an increase, rising two points to 56.

Housing starts

Privately-owned housing starts in February were at a seasonally adjusted annual rate of 897,000, 17 percent below the upwardly revised January estimate of 1,081,000 and 3.3 percent below the February 2014 rate of 928,000.

Single-family housing starts in February were at rate of 593,000, 14.9 percent below the revised January figure of 697,000.

Privately-owned housing completions in February were at a seasonally adjusted annual rate of 850,000, 13.8 percent below the revised January estimate of 986,000 and 1.8 percent below the February 2014 rate of 866,000.

Single-family housing completions in February were at a rate of 595,000, 12.1 percent below the revised January rate of 677,000.