A day after homeBUILDER sentiment finally cracked (though still dramatically more 'confident' than homeBUYERS)...

Source: Bloomberg

...and mortgage rates are rebounding higher, Housing Starts and Building Permits expectations were mixed ahead of this morning's print.

The actual data was NOT mixed with both Starts (-9.8% MoM) and Permits (-2.0% MoM) well below expectations...

Source: Bloomberg

May Housing starts:

This is the biggest MoM drop in multi-family unit starts since 2022...

This dragged the SAARs for both Starts and Permits down to their lowest level since the CVID lockdowns...

Source: Bloomberg

This should not be a surprise given the weakness expected from builders for future sales...

Source: Bloomberg

Perhaps the most shocking chart - that explains why builders are not building single-family homes is that inventories of unsold NEW homes is surging...

Source: Bloomberg

Finally, rate-cut expectations are not helping...

Source: Bloomberg

So, don't bank on The Fed to save the day.