The number of new homes being built increased 0.3% in September. This increase follows a 10.5% rise in August – signaling two consecutive months of growth in residential construction, according to a housing report [.pdf] issued today. However, the amount of new building permits issued in September declined 5.6%. Contrarily, in August, there was a 0.2% rise in the amount of new building permits issued. Notice the relationship between the amount of permits issued in August and the amount of new homes being built in September, 0.2% and 0.3%, respectively. This correlation is not a coincidence – the amount of permits issued in a month signals the amount of new homes being built in the following month. As a result, with the September decline of 5.6% in permits, October will see a decline between 4.5% and 6.5% in the amount of new homes being built – preventing a 3rd consecutive month of residential housing growth.