Last week, June housing starts were 629k annualized vs. 549k for May. It was the highest since January. But housing starts have averaged 400k annualized during the post-bubble years, the lowest in decades according to San Francisco Fed research published yesterday. The paper explores factors affecting weak housing starts and concludes that residential construction will rebound in 2014—IF home prices can stabilize and start appreciating. Below is a link to the full report and some charts from the paper. Chart 4 illustrates the model for the 2014 rebound prediction.