Building Permits
Approvals for future construction -- one step further ahead in the pipeline than housing starts.
What it is
Building Permits counts the number of new construction projects that received regulatory approval during the month, also reported as a seasonally-adjusted annualized rate. Since a permit has to be issued before construction can begin, this leads Housing Starts by anywhere from a few weeks to a few months -- the more forward-looking of the two housing releases.
How it's read alongside Housing Starts
The two are usually reported together and read as a pair. Permits rising while starts are flat suggests more construction is in the pipeline and starts should pick up soon; permits falling while starts still look fine is often an early warning that starts are about to roll over too.
Worked example
If building permits fall for three straight months while housing starts are still holding steady, that divergence is a genuine early warning -- permits leading starts means the construction pipeline is drying up even though ground-breaking activity hasn't caught down to it yet, and reading only the still-solid starts number would miss the coming slowdown.
See Building Permits live
Macrolens tracks this release and scores it into the composite -- free to start, no credit card required.