Economy Watch: Housing Starts, Holiday Travel, Gas Savings
- Dec 17, 2014
U.S. housing starts came in at an annualized rate of 1.028 million units in November, according to the Census Bureau on Tuesday. That’s 1.6 percent below the revised October total of 1.045 million units and 7 percent below the November 2013 rate.
The drop was driven by single-family housing starts, which totaled an annualized 677,000 units in November, down 5.4 percent compared with October, and off 4.6 percent compared with the same month last year. The November 2014 rate for apartment starts (buildings with five units or more), which tends to be more volatile, was 340,000 units, up 7.6 percent for the month but down 11.9 percent compared with last year, the bureau said.
Housing units authorized by building permits – a forward-looking indicator of housing activity – came in at an annualized rate of 1.035 million units in November. That’s 5.2 percent below the revised October rate of 1.092 units and 0.2 percent below the November 2013 rate.
More Americans Will Hit the Road for the Holidays
Some 98.6 million Americans will travel 50 miles or more from home during the year-end holiday season, an increase of 4 percent from last year, according AAA on Tuesday. That’s the highest forecast growth rate for the year-end holiday season since 2009 and the highest travel volume for the holiday period on record. (AAA data dates back to 2001.) The organization defines the year-end holiday period as Tuesday, Dec. 23 to Sunday, Jan. 4.
Nearly 91 percent of all travelers (89.5 million) will take a road trip over the holidays, an increase of 4.2 percent from 2013. Air travel is forecast to grow 1 percent from 2013, with 5.7 million travelers taking to the skies.
“While the economy continues to improve at an uneven pace, it seems more Americans are looking forward with increasing consumer confidence, rather than looking back at the recession,” AAA COO Marshall Doney noted in a statement. “This is helping to drive expected travel volumes to the highest level we have seen for the year-end holidays.”
EIA Estimates Household Savings on Gas in ’15
On average, U.S. households will spend about $550 less on gasoline and motor oil in 2015 than this year, the U.S. Energy Information Administration estimated on Tuesday. The headline reason, of course, is the precipitous drop in the price of gasoline in recent months, and the fact that the price is expected to remain low. Another reason, according to the agency, is that cars on the road now are more fuel efficient than previously.
The EIA predicts that household gasoline costs will average $1,962 next year. If so, that would be the first time gas costs were below $2,000 since 2009.
Wall Street, still jittery about the energy business, with maybe some concern about the latest ruble crisis thrown in, dropped again on Tuesday. The Dow Jones Industrial Average fell 111.97 points, or 0.65 percent, while the S&P 500 and the Nasdaq fell 0.85 percent and 1.24 percent, respectively.